Do It! Review 12-2

Wayne Company is considering a long-term investment project called ZIP. ZIP will require an investment of $125,000. It will have a useful life of 4 years and no salvage value. Annual cash inflows would increase by $80,400, and annual cash outflows would increase by $40,600. The companys required rate of return is 10%. Click here to view PV table. Calculate the net present value on this project. (If the net present value is negative, use either a negative sign preceding the number eg -45 or parentheses eg (45). Round present value answer to 0 decimal places, e.g. 125. For calculation purposes, use 5 decimal places as displayed in the factor table provided.)

Net present value

Whether this project should be accepted?

The project should be acceptedrejected .

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