Question

The Seago Company is planning to purchase $500,000 of equipment with an estimated seven-year life and no estimated salvage value. The company has projected the following annual cash flows for the investment:
Year Projected Cash Flows
1 .... $200,000
2 .... 150,000
3 .... 100,000
4 .... 60,000
5 .... 60,000
6 .... 40,000
7 .... 40,000
Total $650,000
Required
Calculate the net present value of the proposed equipment purchase. Seago uses a 10% discount rate.



$1.99
Sales1
Views36
Comments0
  • CreatedFebruary 21, 2014
  • Files Included
Post your question
5000