Question: . Exercise 8-7 BasicNPVwith Salvage Value Schaefer Organic Farms purchased a new tractor at a cost of $80,000. Annual operating cash inflows are expected to

Exercise 8-7 BasicNPVwith Salvage Value

Schaefer Organic Farms purchased a new tractor at a cost of $80,000. Annual operating cash inflows are expected to be $30,000 each year for four years. At the end of the tractor's useful life, the salvage value of the tractor is expected to be $5,000.

Required:

What is the net present value if thecost of capitalis 12 percent? Use thetime value of money chartsfor your calculations. (Ignore income taxes.) Round your answer to the nearest whole number. $

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