Question: (Present value tables are needed.) Miami Marine Enterprises is evaluating the purchase of an elaborate hydraulic lift system for all of its locations to use
(Present value tables are needed.) Miami Marine Enterprises is evaluating the purchase of an elaborate hydraulic lift system for all of its locations to use for the boats brought in for repair. The company has narrowed their choices down to two: the B14 Model and the F54 Model. Financial data about the two choices follows.
| B14 Model | F54 Model | |
| Investment | $ 320,000 | $ 240,000 |
| Useful life (years) | 8 | 8 |
| Estimated annual net cash inflows for useful life | $ 75,000 | $ 40,000 |
| Residual value | $ 30,000 | $ 10,000 |
| Depreciation method | Straight-line | Straight-line |
| Required rate of return | 14% | 10% |
What is the total present value of future cash inflows and residual value from the B14 Model?
| $218,070 | ||
| $410,655 | ||
| $358,455 | ||
| $38,455 |
Step by Step Solution
There are 3 Steps involved in it
1 Expert Approved Answer
Step: 1 Unlock
Question Has Been Solved by an Expert!
Get step-by-step solutions from verified subject matter experts
Step: 2 Unlock
Step: 3 Unlock
Study Help