Net Present Value Method

The following data are accumulated $by$ Waiola Company $in$ evaluating the purchase $of$ $$130,000of$ equipment, having $a4-$year useful life:

This information has been collected $in$ the Microsoft Excel Online file. Open the spreadsheet, perform the required analysis, and input your answers $in$ the questions below.

Open spreadsheet

$a.$ Assuming that the desired rate $of$ return $is15\%,$ determine the net present value for the proposal. $If$ required, round $to$ the nearest dollar.

Net present value $

$b.$ Would management $be$ likely $to$ look with favor $on$ the proposal?

$,$ because the net present value indicates that the return $on$ the proposal $is$ greater $$ than the minimum desired rate $of$ return $of15\%.$