A project has estimated annual net cash flows of $ 96,200 for four years and is estimated

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A project has estimated annual net cash flows of $ 96,200 for four years and is estimated to cost $ 315,500. Assume a minimum acceptable rate of return of 10%. Using Exhibit 2, determine

(1) The net present value of the project

(2) The present value index, rounded to two decimal places.


Net Present Value
What is NPV? The net present value is an important tool for capital budgeting decision to assess that an investment in a project is worthwhile or not? The net present value of a project is calculated before taking up the investment decision at...
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Related Book For  book-img-for-question

Financial and Managerial Accounting

ISBN: 978-1285078571

12th edition

Authors: Carl S. Warren, James M. Reeve, Jonathan Duchac

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