Juliar Inc. has provided the following data concerning a proposed investment pro
ID: 2472724 • Letter: J
Question
Juliar Inc. has provided the following data concerning a proposed investment project: (Ignore income taxes.) Initial investment $ 210,000 Life of the project 9 years Annual net cash inflows $ 38,000 Salvage value $ 28,000 The company uses a discount rate of 11%. Click here to view Exhibit 13B-1 and Exhibit 13B-2 to determine the appropriate discount factor(s) using tables. Required: Compute the net present value of the project. (Negative amount should be indicated by a minus sign. Round discount factor(s) to 3 decimal places, intermediate and final answers to the nearest dollar amount. Omit the "$" sign in your response.) Net present value $
Explanation / Answer
Statement showing Cash flows Particulars Time PVf@11% Amount PV Cash Outflows - 1.00 (210,000.00) (210,000.00) PV of Cash outflows = PVCO (210,000.00) Annual net cash inflows 1.00 0.9009 38,000.00 34,234.23 Annual net cash inflows 2.00 0.8116 38,000.00 30,841.65 Annual net cash inflows 3.00 0.7312 38,000.00 27,785.27 Annual net cash inflows 4.00 0.6587 38,000.00 25,031.78 Annual net cash inflows 5.00 0.5935 38,000.00 22,551.15 Annual net cash inflows 6.00 0.5346 38,000.00 20,316.35 Annual net cash inflows 7.00 0.4817 38,000.00 18,303.02 Annual net cash inflows 8.00 0.4339 38,000.00 16,489.21 Annual net cash inflows 9.00 0.3909 38,000.00 14,855.14 Cash inflows (Salvage Value) 9.00 0.3909 28,000.00 10,945.89 PV of Cash Inflows =PVCI 221,353.70 NPV= PVCI - PVCO 11,353.70
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.