net cash flows

present value

future value

Fielding Industries is deciding whether to automate one phase of its production process. The manufacturing equipment has a six-year life and will cost $925,000. Projected net cash inflows are as follows: (Click the icon to view the projected net cash inflows.) (Click the icon to view the present value table.) (Click the icon to view the present value annuity table.) (Click the icon to view the future value table.) (Click the icon to view the future value annuity table.) Read the requirements Requirement 1. Compute this project's NPV using Fielding Industries' 14% hurdie rate. Should Fielding Industries invest in the equipment? Why or why not? Begin by computing the project's NPV (net present value). (Round your answer to the nearest whole dollar. Use parentheses or a minus sign for negative net present values.) id Net present value Requirements 1. Compute this project's NPV using Fielding Industries' 14% hurdle rato. Should the company invest in the equipment? Why or why not? 2. Fielding Industries could refurbish the equipment at the end of six years for $101,000. The refurbished equipment could be used one more year, providing $74,000 of net cash inflows in Year 7. In addition, the refurbished equipment would have a $55,000 residual value at the end of Year 7. Should Fielding Industries invest in the equipment and refurbish it after six years? Why or why not? (Hint In addition to your answer to Requirement 1, discount the additional cash outflow and inflows back to the present value.) 1) "1) 1) - Data table Year 1.... $265,000 . Year 2.... $255,000 .. Year 3.... $228,000 Year 4.... $215,000 Year 5.... $202,000 Year 6.... $176,000 Present Value of $1 Periods 1% 2% 3% 4% 5% 6% 8% 10% 12% 14% 16% 18% 20% Period 1 0.990 0.980 0.971 0.962 0.952 0.943 0.926 0.909 0.893 0.877 0.862 0.847 0.83 Period 2 0.980 0.961 0.943 0.925 0.907 0.890 0.8570.8260.797 0.769 0.743 0.7180.69 Period 3 0.971 0.942 0.915 0.889 0.864 0.840 0.794 0.751 0.712 0.675 0.641 0.609 0.57 Period 4 0.961 0.924 0.888 0.855 0.823 0.792 0.735 0.683 0.636 0.592 0.552 0.516 0.48 Period 5 0.951 0.906 0.863 0.822 0.784 0.747 0.681 0.621 0.567 0.519 0.476 0.437 0.40 Period 60.942 0.888 0.837 0.790 0.746 0.705 0.630 0.564 0.5070.4560.410 0.370 0.33 Period 7 0.933 0.871 0.813 0.760 0.711 0.665 0.583 0.513 0.452 0.400 0.3540.314 0.27 Period 8 0.923 0.853 0.789 0.731 0.677 0.627 0.540 0.467 0.4040.3510.305 0.266 0.23 Period 9 0.914 0.837 0.766 0.703 0.645 0.5920.500 0.424 0.361 0.308 0.263 0.225 0.19 Period 0.905 0.820 0.744 0.676 0.614 0.558 0.463 0.386 0.322 0.270 0.2270.1910.16 10 Period 0.896 0.804 0.722 0.650 0.585 0.527 0.429 0.350 0.2870.237 0.195 0.162 0.13 11 Period 0.887 0.788 0.701 0.625 0.557 0.497 0.397 0.319 0.257 0.208 0.168 0.137 0.11 12 Period 0.879 0.773 0.681 0.601 0.530 0.469 0.368 0.290 0.229 0.182 0.145 0.116 0.09 13 Period 0.870 0.758 0.661 0.577 0.505 0.442 0.340 0.263 0.205 0.160 0.125 0.099 0.07 14 Period 0.861 0.743 0.642 0.555 0.481 0.417 0.315 0.2390.183 0.1400.108 0.084 0.06 15 Period 0.820 0.673 0.554 0.456 0.377 0.312 0.215 0.149 0.1040.073 0.051 0.037 0.02 20 Period 0.780 0.610 0.478 0.375 0.295 0.233 0.146 0.092 0.0590.038 0.024 0.0160.01 25 Period 0.742 0.552 0.412 0.308 0.231 0.174 0.099 0.057 0.033 0.0200.012 0.007 0.00 30 VE NIN Future Value of $1 Periods 1% 2% 3% 4% 5% 6% 8% 10% 12% 14% 16% 18% Period 1 1.010 1.020 1.030 1.040 1.050 1.0601.080 1.100 1.120 1.140 1.160 1.180 Period 2 1.020 1.040 1.061 1.0821.103 1.1241.166 1.210 1.254 1.300 1.346 1.392 Period 3 1.030 1.061 1.093 1.125 1.1581.191 1.260 1.331 1.405 1.482 1.561 1.643 Period 4 1.041 1.0821.126 1.170 1.216 1.262 1.360 1.464 1.574 1.689 1.811 1.939 2 Period 5 1.051 1.104 1.159 1.217 1.276 1.338 1.469 1.611 1.762 1.925 2.100 2.288 2 Period 6 1.062 1.126 1.194 1.265 1.340 1.419 1.587 1.772 1.9742.195 2.436 2.700 2 Period 7 1.072 1.149 1.230 1.316 1.407 1.504 1.7141.949 2.2112.502 2.826 3.1853 Period 8 1.083 1.172 1.267 1.369 1.4771.5941.851 2.144 2.476 2.853 3.278 3.759 4 Period 9 1.094 1.195 1.305 1.423 1.551 1.689 1.999 2.358 2.7733.252 3.803 4.435 Period 1.105 1.219 1.344 1.480 1.629 1.791 2.159 2.594 3.106 3.707 4.411 5.234 10 Period 1.116 1.243 1.384 1.539 1.710 1.898 2.332 2.853 3.479 4.226 5.117 6.176 7 11 Period 1.127 1.268 1.426 1.601 1.796 2012 2.518 3.138 3.896 4.818 5.936 7.288 E 12 Period 1.138 1.2941.469 1.665 1.886 2.133 2.720 3.452 4.363 5.492 6.886 8.599 10 13 Period 1.149 1.319 1.513 1.732 1.980 2.261 2.937 3.797 4.8876.261 7.988 10.147 1: 14 Period 1.161 1.346 1.558 1.8012.079 2.397 3.172 4.177 5.474 7.138 9.266 11.974 1: 15 Period 1.220 1.4861.806 2.1912.653 3.207 4.6616.727 9.646 13.743 19.461 27.393 3: 20 Period 1.282 1.6412.094 2.666 3.3864.292 6.848 10.835 17.000 26.462 40.874 62.669 9. 25 Period 1.348 1.811 2.427 3.2434.3225.743 10.063 17.449 29.960 50.950 85.850 143.371 23 7 E 1: han 4% Present Value of Annuity of $1 Periods 1% 2% 3% 5% 6% 8% 10% 12% 14% 16% 18% 20% Period 1 0.990 0.980 0.971 0.962 0.952 0.943 0.926 0.909 0.893 0.877 0.862 0.847 0.833 Period 2 1.970 1.942 1.913 1.886 1.859 1.833 1.783 1.736 1.6901.647 1.605 1.566 1.528 Period 3 2.941 2.884 2.829 2.775 2.723 2.673 2.577 2.487 2.402 2.322 2.246 2.174 2.106 Period 4 3.902 3.808 3.717 3.630 3.546 3.465 3.312 3.170 3.037 2.914 2.798 2.690 2.589 Period 5 4.853 4.713 4.580 4.452 4.329 4.212 3.993 3.791 3.605 3.433 3.274 3.127 2.991 Period 6 5.795 5.601 5.417 5.242 5.076 4.917 4.623 4.355 4.1113.889 3.685 3.498 3.326 Period 7 6.728 6.472 6.230 6.002 5.786 5.582 5.206 4.868 4.5644.288 4.039 3.812 3.605 Period 8 7.652 7.325 7.020 6.733 6.463 6.210 5.747 5.335 4.968 4.639 4.344 4.0783.837 Period 9 8.566 8.1627.786 7.435 7.108 6.802 6.247 15.759 5.328 4.946 4.607 4.3034.031 Period 9.471 8.983 8.530 8.111 7.722 7.360 6.710 6.145 5.6505.216 4.833 4.494 4.192 10 Period 10.3689.787 9.253 8.760 8.306 7.887 7.139 6.495 5.938 5.453 5.029 4.656 4.327 11 Period 11.255 10.575 9.954 9.385 8.863 8.384 7.536 6.814 6.1945.660 5.197 4.793 4.439 12 Period 12.134 11.348 10.635 9.986 9.3948.853 7.904 17.103 6.424 5.842 5.342 4.910 4.533 13 Period 13.004 12.10611.296 10.563 9.899 9.295 8.244 7.367 6.628 6.002 5.468 5.0084.611 14 Period 13.865 12.849 11.938 11.118 10.380 9.712 8.559 7.606 6.811 6.142 5.575 5.092 4.675 15 Period 18.046 16.35114.87713.590 12.462 11.470 9.818 8.514 7.4696.623 5.929 5.353 4.870 20 Period 22.023 19.52317.413 15.622 14.094 12.783 10.6759.077 7.843 6.873 6.097 5.467 4.948 25 Period 25.808 22.396/19.60017.292 15.372 13.765 11.2589.427 8.055 7.003 6.177 5.517 4.979 20 4 16% 1.000 189 1.00 2.160 2.18 3.506 3.57 Future Value of Annuity of $1 Periods 1% 2% 3% 4% 5% 6% 8% 10% 12% 14% Period 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 11 Period 2.0102.020 2030 2.040 2.050 2.060 2.080 2.100 2.120 2.140 2 Period 3.0303.0603.091 3.122 3.153 3.184 3.246 3.310 3.374 3.440 3 Period 4.060 4.122 4.1844.246 4.310 4.375 4.506 4.641 4.779 4.921 4 Period 5.101 5.204 5.309 5.416 5.526 5.637 5.867 6.105 6.353 6.610 5 Period 6.1526.308 6.468 6.633 6.802 6.975 7.336 7.716 8.115 8.536 16 Period 7.214 7.4347.662 7.898 8.142 8.394 8.923 9.487 10.089 10.730 5.066 5.21 6.877 7.15 8.977 9.44 11.414 12.1 Period 8.286 8.5838.8929.214 9.549 9.897 10.637 11.436 12.300 13.233 14.240 15.3 Period 9.369 9.755 10.15910.583 11.027 11.491 12.488 13.579 14.776 16.085 17.519 19.0 Period 10.462 10.950 11.464 12.006 12.578 13.181 14.487 15.937 17.549 19.337 21.321 23.5 10 Period 11.567 12.169.12.80813.486 14.207 14.972 16.645 18.531 20.655 23.045 25.733 28.7 11 Period 12.68313.412 14.19215.026 15.917 16.870 18.977 21.384 24.133 27.271 30.850 34.9 112 Period 13.809 14.680 15.61816.627 17.713 18.882 21.495 24.523 28.029 32.089 36.786 422 113 Period 14.947 15.974 17.08618,292 19.599 21.015 24.215 27.975 32.393 37.581 43.672 50.8