Koeq Enterprises is considering a long-term investment project called ZIP. ZIP will require an investment of NT$1,200,000.
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Koeq Enterprises is considering a long-term investment project called ZIP. ZIP will require an investment of NT$1,200,000. It will have a useful life of 4 years and no residual value. Annual cash inflows would increase by NT$800,000, and annual cash outflows would increase by NT$400,000. The company’s required rate of return is 12%. Calculate the net present value on this project and discuss whether it should be accepted.
Net Present ValueWhat 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
Accounting Principles
ISBN: 978-1119419617
IFRS global edition
Authors: Paul D Kimmel, Donald E Kieso Jerry J Weygandt
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