Perit Industries has $$100,000$ to invest. The company is trying to decide between two alternative uses of the funds. The alternatives are:

Project A Project B

Cost of equipment required $$100,000$ $$0$

Working capital investment required $$0$ $$100,000$

Annual cash inflows $$21,000$ $$15,750$

Salvage value of equipment in six years $$8,000$ $$0$

Life of the project $6$ years $6$ years

The working capital needed for project B will be released at the end of six years for investment elsewhere. Perit Industries' discount rate is $14\%.($Ignore income taxes.$)$

Required:

$($a$)$

Using Excel, calculate net present value for each project. $($Negative amount should be indicated by a minus sign. Round your answer to the nearest dollar amount. Omit the $"$$$"$ sign in your response.$)$

Net present value

Project A $ $-14693$ Numeric ResponseEdit Unavailable. $-14693$ correct.

Project B $ $8301$ Numeric ResponseEdit Unavailable. $8301$ incorrect.

$($b$)$ Which investment alternative $($if either$)$ would you recommend that the company accept?

Project B Correct