Net present value method The following data are accumulated by Waiola Company in evaluating the purchase of $164,500 of equipment, having a 4 -year useful life: . Assuming that the desired rate of return is 12%, determine the net present value for the proposal. Use the table of the present value of $1 oresented above. If required, round to the nearest dollar. If required, use the minus sign to indicate a negative net present value. Would management be likely to look with favor on the proposal? , because the net present value indicates that the return on the proposal is than the minimum desired rate of return of 12%. Feedback +Oreak My Work a. Multiply the present value of $1 factor for each year (Refer Exhibit 2 in the text.) by that year's net cash flow. Subtract the amount to be invested from the total present value of the net cash flow. Will management be more favorable to a positive net present value or a negative net present value? b. Consider the time value of money