Question: I am not sure how to solve this problem. Help would be appreciated. 2. The company is considering a project involving the purchase of new




2. The company is considering a project involving the purchase of new equipment Change the data area of your worksheet to match the following: Use Exhibit 148.1 and Exhibit 14B-2 (Use appropriate factor(s) from the tables provided.) B $ $ A 1 Chapter 14: Applying Excel 2 3 Data 4 Example E 5 Cost of equipment needed 6 Working capital needed 7 Overhaul of equipment in four years 8 Salvage value of the equipment in five years 9 Annual revenues and costs 10 Sales revenues 11 Cost of goods sold 12 Out-of-pocket operating costs 13 Discount rate 360,000 45,000 25,000 35,000 $ $ $ $ $ 380,000 210,000 65,000 15% a. What is the net present value of the project? (Negative amount should be indicated by a minus sign. Round your present value factor to 3 decimals and round all other intermediate calculations to nearest whole dollar.) Net present value $ (33,763) c. The internal rate of return is between what two whole discount rates (e.g., between 10% and 11%, between 11% and 12%, between 12% and 13%, between 13% and 14%, etc.)? The internal rate of return is between % and d. Reset the discount rate to 15%. Suppose the salvage value is uncertain How large would the salvage value have to be to result in a positive net present value? Minimum salvage value required to generate a positivo prosent value EXHIBIT 148-1 Procent Value of St; 245 0 Periods 5% 6% 7% 88 9% 10% 15 12% 149 15% 16% 17 18% 1 20% 216 22% 23% 25% 0.952 0.952 0.943 0.935 0.926 0.917 0.909 0.901 0.893 0.885 0.877 0.870 0.862 0.855 0.847 0.840 0.833 0.826 0.820 0.81 0.806 0.800 2 0925 0907 0,8900873 0857 0.842 0826 0.812 0797 0783 0769 0756 0743 0731 0718 0.706 0.694 0.683 0.672 0661 0650 0,640 3 0.889 0.864 0.840 0.816 0.794 0.772 0.751 0731 0.712 0,693 0.675 0.658 0.641 0.624 0.509 0.593 0.579 0.564 0.551 0.537 0.524 0.512 4 0.855 0.823 0.792 0763 0.735 0.708 0.683 0.659 0636 0.613 0.592 0.572 0.552 0.534 05160499 0.482 0.467 0.451 0.437 0.423 0410 5 0.822 0.784 0.747 0713 0.681 0.650 0.621 0.593 0.567 0543 0.519 0.497 0.476 0.456 0.437 0.419 0402 0.386 0.370 0.355 0.341 0.328 6 0.790 0.746 0.705 0.666 0.630 0.596 0.564 0.535 0.507 0.480 0.456 0.432 0.410 0.390 0.370 0.352 0.335 0.319 0.303 0.289 0275 0262 7 0.750 0.7 0.665 0.623 0.583 0.547 0.513 0482 0.452 0.425 0.400 0.376 0.354 0333 0.314 0.296 0279 0.263 0.249 0.235 0.222 0.210 0.731 0.677 0.627 0582 0.540 0502 0.467 0.434 0.404 0.376 0.351 0.327 03050285 0.266 0.2490.233 0.218 0.204 0191 01P 0.168 0.703 0.645 0.592 0.544 0.500 0.460 0.424 0.391 0.361 0.333 0.308 0.284 0.263 0243 0225 0.209 0194 0150 0.167 0155 0144 014 10 0676 0.614 0.558 0.508 0463 0.422 0.386 0.352 0.322 0.295 0270 0247 0.227 0.208 0.191 0178 0362 0.149 0.137 0126 0.116 0.107 0650 0.585 0.527 0.475 0.429 0.388 0.250 0.317 0.287 0.261 0.237 0.215 0.195 0.178 0.62 0.548 01350123 0.112 0103 0.094 0.086 12 0.625 0.557 0.497 0.444 0.397 0.356 0.319 0286 0.25% 0.231 0.208 0.187 0.168 0152 0137 0124 0.112 0102 0.092 0.003 0.076 0.069 13 0.601 0.530 0.469 0.415 0.368 0.326 0.290 0.258 0229 0.204 0182 0.163 0.145 0.130 0.116 0.04 0.093 0.084 0.075 0.068 0.061 0.055 14 0.577 0.505 0.442 0.388 0.340 0.299 0.263 0.232 0.205 0.181 0160 0.141 01250m 0.099 0.008 0.078 0.069 0.062 0.055 0.049 0.044 15 0.555 0.481 0.417 0.362 0.315 0275 0.239 0.209 0183 0160 0.540 0123 0108 0.095 0.034 0.074 0.005 0.057 0.051 0.045 0.040 0.035 0.534 0.458 0.394 0.339 0.292 0.252 0.218 0.188 0163 0.141 0.123 0.1070090 0.081 0.071 0.062 0.054 0047 0.042 0.036 0.032 0028 0.513 0.436 0.371 0317 0.270 0.231 0.198 01700146 0125 0.108 0.093 0.080 0.069 0.000 0.052 0.045 0.039 0.034 0.030 0.025 0.023 0.494 0.416 0.350 0296 0.250 0.212 0.190 0153 01-30 0.111 0.095 0.081 0.069 0.059 0051 0.04 0.038 0032 0.028 0.024 0.021 0.018 19 0475 0.396 0.331 0.277 0.232 0.194 0554 0138 0.116 0098 0.003 0.070 0000 0.051 0043 0.037 0.031 0.027 0.023 0.020 0,017 0054 0.456 0.377 0.312 0258 0.215 01 0.149 0.124 0104 0.087 0.073 0.061 0051 0.043 0.037 0.031 0.025 0.022 0.0190016 0.014 0.012 0.439 0.359 0.294 0242 0199 0:164 0135 0.112 0.093 0.077 0.064 0.053 0044 0.037 0.031 0.025 0.022 0.0180.015 600 0.009 0.422 0.342 0.278 0.226 0.184 0.150 0.123 0.101 0.083 0.008 0.056 0.046 0.038 0.0320026 0.022 0.018 0,015 0.013 001 0.009 0.007 0.405 0.326 0.262 0211 0.170 0133 0.112 0.091 0.074 0.000 0.049 0.000 0.033 0.027 0.022 0.01 0.015 0.012 0010 0.009 0.007 0.005 0.390 0.310 0.2470197 0.126 0102 0.002 0.066 0.053 0.043 0035 0.028 0023 0.019 0,015 000 0.00 0.00 0.007 0.006 0005 0375 0.295 0.2330184 0.146 0.116 0.092 0.074 0.059 0012 0.038 0.030 0.024 0.020 0.016 0.00 0.00 0.009 0.007 0.006 0.005 0.004 20 0.361 0281 0.220 0.172 0.906 0.084 0.006 0.053 0042 0.033 0.026 0.021 0.017 001 0.01 0.009 0.007 0.005 0,005 0,004 0.003 27 0.347 0.258 0207 0161 0125 0.098 0.076 0.000 0.047 0.037 0.029 0.023 0.0005 0.01 0.009 0.007 0.006 0.005 0.004 0.000 0.002 28 0333 0255 0196 0150 OTHE 0.090 0.069 0054 0.042 0.033 0.026 0.020 0016 0.012 0.000 0.00 0.00 0.005 0.004 0003 0002 0.002 29 0321 0.243 0185 0.141 0.107 0.082 0.063 0048 0.037 0.029 0.022 0.017 001 0.011 0 0 006 005 000.00 2002 0 000g 30 03000231 0174 0.031 0.099 0.075 0.057 0.044 0.033 0.026 0.020 0,015 0,012 0009 0.007 0.005 0.004 0.003 0.003 0.002 0.002 0001 40 0.209 0142 0.097 0.067 0.046 0032 0.02200150011 0.008 0.005 0004 0.003 0.002 0.001 0.001 000 0000 0000 0000 0.000 0.000 jh - 56 >> 58 0135 DHIBIT 140-2 Present Value of an Annuilty of $1 in Arrearst Periods 1 3 5 6 7 0 10 12 14 15 Egg 49 5% 6% 8% 99 10% 11 129 0.962 0.952 0.943 13% 149 15% 16% 18% 19% 20% 21 0.935 0.917 0.926 22 23 24 25 0.909 0.901 0.893 0.885 0.877 0.870 0.862 0.855 0.847 0.840 0.833 0826 0.820 0.313 0.906 0800 1886 1859 1833 1.808 1783 1759 1736 1713 1690 1669 1647 2775 1626 1605158515661547 1528 15091492 1474 2723 2673 2624 2.577 1457 1440 2531 2487 2444 2402 2.361 2322 2283 2246 2.210 2.174 3.630 3.546 2140 3.465 3.387 2.106 2074 2042 2011 1952 3.312 3.240 1981 3.170 3.102 3037 2974 2.914 2855 2798 2743 2690 2639 2.589 2540 2494 2448 2404 2.362 4.452 4.329 4.212 4100 3.993 3.890 3.791 3.696 3.605 3.517 3.433 3352 3.274 3199 3127 3.058 2.991 2.926 2.364 2.803 2.745 2689 5.242 5.076 4917 4767 4623 4496 4355 4 231 4111 3.998 3.889 3784 3685 3.589 3.498 3.410 3326 3.245 3167 3092 3020 2.951 6.002 5.786 5.582 5.389 5.206 5033 4.868 4712 4.564 4423 4288 4160 40393.922 3.812 3706 3.605 3.508 3.416 3.327 32423.161 6733 6.463 6.210 5.971 5.747 5.535 5.335 5146 4908 4799 4.639 4487 4.344 4.207 4078 3.954 3.837 3.726 3699 3.518 3421 3.329 7435 7108 G.E02 6.515 6.247 5.995 5759 5.537 5328 5.132 49.46 4772 4.607 4.451 43034163 4031 3.9053796 36733.566 3463 7.722 7360 7024 6.710 6.418 6145 5.889 5650 5.426 5.21 5019 4.833 4659 449443394192 4.054 3.923 3799 3.682 3571 8.760 8.306 7887 7.499 7139 6.805 6.495 6.207 5.938 5.687 5.453 5234 5029 4836 4656 4 486 4.327 477 4035 3.902 3.776 3656 9385 8.863 8.384 7.943 7536 7161 6.814 6492 6.194 5.918 5660 5.421 5197 4988 47934611 4439 4.278 4127 3.985 3.851 3725 9.986 9.394 8.853 8.358 7904 7487 7103 6.750 6.424 6122 5.842 5583 5342 5118 4.910 475 4533 4.362 4203 4.053 3.912 700 10:563 9.899 9.295 8.745 8.244 7796 7.367 6 982 6 628 6 302 6.002 5.724 5.468 5.229 5.000 4.802 4671 4432 4265 4108 3.962 3.824 11.119 10.390 9712 9108 8.559 E06 7606 7191 6.811 6.462 6.542 5.8475.575 5.324 5.092 476 4.675 4.4994315 4153 4.001 3.852 11.652 10.838 10106 9.447 8 851 8.313 7824 73796.974 6,604 6.265 5.954 5.668 5.405 5.162 4938 4730 4536 4.357 4.189 4.033 3887 12.166 11274 10.477 9763 9122 8.544 8.022 7549 2120 6729 6.373 6047 5749 5.475 5222 4990 4775 4.576 4391 4219 4059 3.910 12659 11690 10.828 10.059 9.372 3.756 8.20127027250 6.840 6.467 6.128 5.818 5.534 5.27350334812 4608 4.419 4234000 3.928 13134 12 085 11158 10.336 9.604 8950 8.365 78397366 6.938 6.550 6798 5877 5584 5.316 5070 48434635 4.442 4.263 4,097 3.942 13.590 12 462 11.470 10.594 9.818 9129 8.514 7963 74697025 6623 6.259 5.9295,628 5.353 5101 4870 4657 4460427940 3954 14.029 12.82111764 10.836 10.017 9.292 8.649 8075 75627802 1953 6687 6312 59735.665 5384 5127 4.191 4675 4.476 4292 4121 10.201 9442 14.451 3.13 12.042 11.061 8.7728.176 7645 2170 6743 6.359 6.011 5696 5410 5149 3.970 4.909 4690 4438 4302 4130 8.883 8.206 7718 7230 6792 6.399 6044 5723 542 5167 4137 4.92547034499 4311 14.857 13.489 12.303 11272 10.371 9.580 3.976 8.985 8348 7784 7.283 6035 6.434 60735.746 5451 5102 4937 4700 4.507 438 15,247 1379912550 11469 10.529 9707 41433981 :1 15.622 14.094 12783 1 10.675 9.823 9.077 8.422 7543 7330 6.873 6.4646097 5766 5467 5195 4,5143234147 11654 7372 9.161 3.4887896 3980 6.906 6.491 6.119 5.783 5.490 5.206 4956 4728 4520 4320 415 15.983 14.375 13.003 1826 10.810 9.929 3990 16 330 14.543 1211 11.987 10,935 10.027 9.237 9.548 794374096935 6.514 606 5.7985492 5.215 4.964 4734 4524 4322 4154 1992 (5) 16.663 14.898 13.406 12137 10.110 9307 3602 79347441 6.9016534 6.152 5.810 5502 52234970 47394520 4335 4.157 4.531 433741593994 16 904 15541 13.591 12 278 11158 10.198 9.370 1.650 8022 7470 6980 6.551 6166 5820 5.510 5229 4975 4743 58295517 5.235 49794746 4534 43394100 3995 17.292 15.372 13.785 12.409 11 258 10.2749.427 3.694 3.055 7496 7003 6.566 6.177 19.793 17159 15.046 13.332 11.925 10757 9.7793951 8.244 7634 71056642 6233 5.871 5.548 5.258499747604544 43474166 3.999 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 40
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