Question: Exercise 10-5A (Algo) Determining net present value LO 102 Rundie Company is consideting imvesting in two new vans that are expected to generate combined cash
Exercise 10-5A (Algo) Determining net present value LO 102 Rundie Company is consideting imvesting in two new vans that are expected to generate combined cash inflows of $28,500 per year The vans combined purchase price is $94,500. The expected life and salvage value of each are seven years and $20,600, respectively. Rundle has an werage cost of capital of 12 percent. (PV of St and PVA of sit) Note: Use oppropriate foctoris) from the tables provided. Required a. Caiculate the net present value of the investment opportunity. Note: Negative amount should be indicoted by a minus sign. Round your intermediote calculations and final answer to 2 decimal places. b. Indicate whether the investment opportunity is expected to earn a return that is above or below the cost of capeat and whether it shoulid be accepted
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