Exercise 12-14 (Algo) Comparison of Projects Using Net Present Value (LO12-2] Labeau Products, Limited, of Perth, Australia, has $26,000 to invest. The company is trying to decide between two alternative uses for the funds as follows: Investment required Annual cash inflows, Single cash inflow at the end of 6 years Life of the project. The company's discount rate is 12%. Invest in Project X $ 26,000. Invest in Project Y. $ 26,000 $ 8,000 $ 50,000 6 years 6 years Click here to view Exhibit 128-1 and Exhibit 128-2 to determine the appropriate discount factor(s) using tables. Required: 1. Compute the net present value of Project X. 2. Compute the net present value of Project Y. 3. Which project would you recommend the company accept? XHIBIT 12B-2 resent Value of an Annuity of $1 in Arrears; 1/r(1-(1/(1+r)^n)) Periods 4% 5% 6% 1 0.962 0.952 0.943 2 1.886. 1.859 3 2.775 2.723 2.577 4 3.630 3.546 5 6 5.242 5.076 4.917 7 6.002 5.786 5.582 8 6.733 6.463 6.210 5.971 5.747 9 7.435 7.108 6.802 6.515 6.247 10 8.111 7.722 7.360 7.024 6.710 11 8.760 8.306 7.887 7.499 7.139 12 9.385 8.863 8.384 13 9.986 9.394 14 10.563 9.899 9.295 15 7.536 7.904 8.745 8.244 11.118 10.380 9.712 9.108 7.943 8.853 8.358 16 11.652 10.838 10.106 9.447 8.559 8.851 17 18 19 12.166 11.274 10.477 9.763 12.659 11.690 10.828 10.059 9.372 13.134 12.085 11.158 10.336 9.604 9.122 8.756 8.950 20 21 22 23 24 13.590 12.462 11.470 10.594 9.818 14.029 12.821 11.764 10.836 10.017 9.292 14.451 13.163 12.042 11.061 10.201 9.442 14.857 13.489 12.303 11.272 10.371 9.580 15.247 13.799 12.550 11.469 10.529 9.707 9.129 7% 8% 9% 10% 11% 12% 13% 14% 15% 16% 17% 18% 15 0.935 0.926 0.917 0.909 0.901 0.893 0.885 0.877 0.870 0.862 0.855 0.847 0. 1.833 1.808 1.783 1.759 1.736 1.713 1.690 1.668 1.647 1.626 1.605 1.585 1.566 13 2.673 2.624 2.531 2.487 2.444 2.402 2.361 2.322 2.283 2.246 2.210 2.174 2. 3.465 3.387 3.312 3.240 3.170 3.102 3.037 2.974 2.914 2.855 2.798 2.743 2.690 2.c 4.452 4.329 4.212 4.100 3.993 3.890 3.791 3.696 3.605 3.517 3.433 3.352 3.274 3.199 3.127 3.0 4.767 4.623 4.486 4.355 4.231 4.111 3.998 3.889 3.784 3.685 3.589 3.498 3.4 5.389 5.206 5.033 4.868 4.712 4.564 4.423 4.288 4.160 4.039 3.922 3.812 3.7 5.535 5.335 5.146 4.968 4.799 4.639 4.487 4.344 4.207 4.078 3.9 5.995 5.759 5.537 5.328 5.132 4.946 4.772 4.607 4.451 4.303 4.1 6.418 6.145 5.889 5.650 5.426 5.216 5.019 4.833 4.659 4.494 4.3 6.805 6.495 6.207 5.938 5.687 5.453 5.234 5.029 4.836 4.656 4.45 7.161 6.814 6.492 6.194 5.918 5.660 5.421 5.197 4.988 4.793 4.6) 7.487 7.103 6.750 6.424 6.122 5.842 5.583 5.342 5.118 4.910 4.71 7.786 7.367 6.982 6.628 6.302 6.002 5.724 5.468 5.229 5.008 4.80 8.061 7.606 7.191 6.811 6.462 6.142 5.847 5.575 5.324 5.092 4.87 8.313 7.824 7.379 6.974 6.604 6.265 5.954 5.668 5.405 5.162 4.93 8.544 8.022 7.549 7.120 6.729 6.373 6.047 5.749 5.475 5.222 4.99 8.201 7.702 7.250 6.840 6.467 6.128 5.818 5.534 5.273 5.03 8.365 7.839 7.366 6.938 8.514 7.963 7.469 7.025 8.649 8.075 7.562 7.102 8.772 8.176 7.645 7.170 8.883 8.266 7.718 7.230 8.985 8.348 7.784 7.283 6.550 6.198 5.877 5.584 5.316 5.070 6.623 6.259 5.929 5.628 5.353 5.10. 6.687 6.312 5.973 5.665 5.384 5.122 6.743 6.359 6.011 5.696 5.410 5.149 6.792 6.399 6.044 5.723 5.432 5.167 6.835 6.434 6.073 5.746 5.451 5.182 EXHIBIT 12B-1 1 Present Value of $1; (1+r)" Periods 4% 1 5% 6% 7% 0.962 0.952 0.943 0.935 2 0.925 0.907 0.890 0.873 0.857 0.842 0.826 3 0.889 0.864 0.840 0.816 0.794 0.772 0.751 4 0.855 0.823 0.792 0.763 0.735 0.708 0.683 5 0.822 0.784 0.747 0.713 0.681 0.650 6 0.790 0.746 0.705 0.666 7 0.760 0.711 0.665 0.623 8 0.731 0.677 0.627 0.582 9 0.703 0.645 0.592 0.544 0.500 | 0.460 10 0.676 11 0.650 0.585 12 13 14 0.577 15 0.555 0.481 0.417 0.362 0.340 0.299 0.263 0.232 0.315 16 0.534 0.458 0.394 0.339 0.292 0.252 0.218 17 0.513 0.436 0.371 0.317 18 0.494 0.416 0.350 0.296 0.250 19 0.475 0.396 0.331 0.277 0.232 20 0.456 0.377 0.312 0.258 0.215 21 0.439 0.359 0.294 0.242 0.199 22 0.422 0.342 0.278 23 0.406 0.326 | 0.262 8% 9% 10% 11% 12% 13% 14% 15% 16% 17% 0.926 0.917 0.909 0.901 0.893 0.885 0.877 0.870 0.862 0.855 0.812 0.797 0.783 0.769 0.756 0.743 0.731 0.718 0.731 0.712 0.693 0.675 0.658 0.641 0.624 0.609 0.659 0.636 0.613 0.592 0.572 0.552 0.534 0.516 0.621 0.593 0.567 0.543 0.519 0.497 0.476 0.456 0.437 0.630 0.596 0.564 0.535 0.507 0.480 0.456 0.432 0.410 0.390 0.370 0.583 0.547 0.513 0.482 0.452 0.425 0.400 0.376 0.354 0.333 0.314 0.540 0.502 0.467 0.434 0.404 0.376 0.351 0.327 0.424 0.391 0.361 0.308 0.284 0.263 0.243 0.225 0.614 0.558 0.508 0.463 0.422 0.386 0.352 0.322 0.270 0.247 0.227 0.208 0.191 0.527 0.475 0.429 0.388 0.350 0.317 0.287 0.237 0.215 0.195 0.178 0.162 0.625 0.557 0.497 0.444 0.397 0.356 0.319 0.286 0.208 0.187 0.168 0.152 0.137 0.601 0.530 0.469 0.415 0.368 0.326 0.290 0.258 0.182 0.163 0.145 0.130 0.116 0.505 0.442 0.388 0.160 0.141 0.125 0.111 0.275 0.239 0.209 0.183 0.160 0.140 0.123 0.108 0.095 0.188 0.163 0.141 0.123 0.107 0.093 0.081 0.270 0.231 0.198 0.170 0.146 0.125 0.108 0.093 0.080 0.069 0.060 0.212 0.180 0.153 0.130 0.111 0.095 0.081 0.069 0.059 0.051 0.194 0.164 0.138 0.116 0.098 0.083 0.070 0.060 0.051 0.043 0.178 0.149 0.124 0.104 0.087 0.073 0.061 0.051 0.043 0.037 0.164 0.135 0.112 0.093 0.077 0.064 0.053 0.044 0.037 0.031 0.226 0.184 0.150 0.123 0.101 0.083 0.068 0.056 0.046 0.038 0.032 0.026 0.211 0.170 0.138 0.112 0.091 0.074 0.060 0.049 0.040 0.033 0.027 0.022 18% 0.847 0.305 0.285 0.266 0.333 0.295 0.261 0.257 0.231 0.229 0.204 0.205 0.181 0.099 0.084 0.071