Bob is considering buying a small shop on Vancouver Island. He has found a small shop...

Transcribed Image Text:

Bob is considering buying a small shop on Vancouver Island. He has found a small shop with a purchase price of $420,000. He will ieed to spend an additional $20,000 immediately for renovations and he plans to sell the business for $600,000 in 15 years. He estimates that his annual expenses will be $8,000 and he anticipates that his revenue will be S15,000 per year. Assume revenue occurs at the end of each vear and expenses occur at the beginning of each year. What is the initial cash flow CF0? Bob is considering buying a small shop on Vancouver Island. He has found a small shop with a purchase price of $420,000. He will ieed to spend an additional $20,000 immediately for renovations and he plans to sell the business for $600,000 in 15 years. He estimates that his annual expenses will be $8,000 and he anticipates that his revenue will be S15,000 per year. Assume revenue occurs at the end of each vear and expenses occur at the beginning of each year. What is the initial cash flow CF0?

Answer rating: 100% (QA)

Initial Cash Flow Initial cash flow is the cash req... View the full answer