Preston Company is considering acquiring a manufacturing plant. The purchase price is $1,000,000. The owners believe...

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Preston Company is considering acquiring a manufacturing plant. The purchase price is $1,000,000. The owners believe the plant will generate net cash inflows of $307,000 annually. It will have to be replaced in 6 years. Use the payback method to determine whether Preston Company should purchase this plant. Round to one decimal place. Select the formula, then enter the amounts to calculate the payback period for the plant (Round payback to one decimal place, XX) The payback occurs the plant must be replaced, so the payback method exactly when well after well before Payback years purchasing the plant Your grandfather would like to share some of his fortune with you. He offers to give you money under one of the following scenarios (you get to choose) 1. $8,250 per year at the end of each of the next 8 years 2. $50,100 (ump sum) now 3. $99,850 (lump sum) 8 years from now Read the requirements View the Present Value of $1 table View the Proser Value of Ordinary Acuity of stable Requirement 1. Calculate the present value of each scenario using a 6% discount rate. Which scenario yields the highest present value? (Round the factors to three decimal places, XXXX Round the present value to the nearest whole dollar.) Scenario 1, 6% discount rate, Present value Scenario 2,6% discount rate, Present value Scenario 3, 6% discount rate. Present value appears to be the best option. Based on a 6% interest rate, its present value is the Requirement 2. Would your preference change if you used a 12% discount rate? Compute the present value of each scenario using a 12% discount rate. (Round the factors to three decimal places, XXXXX Round the present value to the nearest whole dollar) Scenario 1, 12% discount rate, Present value Scenario 2, 12% discount rate, Present value Scenario 3, 12% discount rate, Present value appears to be the best option. Based on a 12% interest rate, its present value is the Next 23 Face to face iz Present Value of $1 Question 3 ots This quiz: 10 points) possible e - X Present Value of $1 Periods Period 1 Period 2 1% 2% 3% 4% 5% 0% Parfod 3 Period 4 16% 7% 8% 9% 10% 12% 14% 15% 18% 20% 0.990 0.960 0.971 0.962 0.952 0.943 0.935 0.826 0.917 0909 0.853 0.877 0870 0.882 0.047 0833 0.980 0.561 0.943 0.925 0.907 0.890 0.873 0.857 0.842 0826 0.767 0.769 0.756 0743 0.718 0.654 0.971 0.942 0.915 0.889 0.864 0.840 0816 0.794 0772 0.751 0712 0675 0.658 0.641 0.609 0.579 0961 0.924 0888 0.855 0823 0782 0.763 0.735 0.708 0.683 0.638 0.592 0572 0.552 0516 0.482 Period 5 0.951 0.906 0.865 0822 0.764 0.747 0713 0881 0.050 0821 0.567 0.519 0.497 0.476 0.437 0402 Period 0.342 0.858 0.837 0.790 0.746 0705 0.666 0.630 0.59 0.564 0.507 0.456 0432 0410 0.370 0.335 Period 7 0.333 0.871 0.813 0.760 0.711 0.665 0623 0.583 0.547 0513 0.452 0.400 0.376 0354 0314 0.279 Period 0.923 0.853 0.789 0731 0.677 0.627 0.582 0.540 0.502 0467 0404 0.361 0.327 0305 0296 0.233 Parlod 9 0914 0.837 0.756 0.703 0645 0.592 0544 0.500 0.460 0.424 0361 0.308 0.284 0.263 0.225 0194 Period 10 0805 0.820 0.744 0.676 0614 0.558 0.508 0463 0422 0.386 0322 0270 0247 0.227 0.191 0162 Period 11 0.396 0.804 0.722 0.650 0.585 0.527 0475 0429 0369 0.350 0287 0237 0215 0136 0.162 0.135 Period 12 0.887 0.788 0701 0625 0.557 0.497 0444 0.387 0358 0319 0.257 0208 0.167 0.168 0137 0.112 Period 13 0.879 0.773 0.681 0.605 0.530 0.409 0415 0.368 0326 0290 0.229 0182 0163 0.145 0.116 6093 Period 14 0.670 0.758 0.661 0577 0.506 0442 0.388 0.342 0299 0263 0.205 0160 0141 0.125 0.099 0.078 Period 15 0.861 0743 0642 0555 0481 0.417 0.362 0.315 0275 0239 0.183 0.140 0123 0108 0.064 0.065 Period 16 0.853 0.728 0.625 0.534 0.458 0.394 0.339 0.292 0.252 0218 0.163 0.123 0.107 0.083 0.01 0.054 Period 17 0844 0.714 0.805 0.513 0.436 0371 0317 0.270 0231 0196 0.146 0.100 0.093 0.080 0.060 0.045 Period 18 0836 0.700 0.587 0.494 0416 0.350 0.296 0.250 0.212 0180 0130 0.095 0.081 0.069 0.051 0.038 Period 19 0.828 0886 0.570 0475 0.396 0331 0277 0.232 0.194 0164 0.116 0.083 0.070 0060 0.043 0.031 Period 20 0.820 0873 0554 0456 0377 0312 0258 0215 0.178 0.149 0.504 0.073 0.001 0.055 0.037 0.029 Period 21 0.811 0.060 0.538 0439 0.359 0294 0242 0.199 0.164 0.135 0.083 0.064 0.063 0.044 0.001 0.022 Period 22 0.803 0647 0522 0422 0342 0278 0226 0.154 0.150 0.123 0083 0056 0046 0.038 0.026 0.018 Period 23 0.786 0.634 0.507 0.406 0326 0262 0211 0.170 0.138 0112 0.074 0.049 0.040 0.033 0022 0.015 Period 24 0.788 0.622 0482 0.390 0310 0247 0187 0.158 0125 0.102 0.066 0.043 0.035 0.028 0.019 0.013 band 35 la anlasalaala Lanon In Insen In the Incas Lana na nas lama lansa Inom Print Done Maryam Habhab Submit quiz tors to three decimal places, XXXXX, Round the nearest whole dolar.) Next pearson.com Fall 23 Face to face 1 quiz Chioter 11.02 400/Wand 240334150 Question 2nd This quiz: 10 points possible Present Value of Ordinary Annuity of $1 Maryam Habhab Submit quiz Periods 1% Period 1 Period 21 1856 Period 3 2775 Period 4 3630 4.452 Period 17 Period 18 Period 13 Present Value of Ordinary Annuity of $1 2% 3% 4% $% 0% 7% 0% 9% 10% 0990 0.980 0.971 0.962 0.962 0345 0835 0926 0917 0909 0.890877 0870 0M2 0.47 0.833 12% 14% 15% 10% 18% 20% 1970 1.942 1913 1859 1833 180 1783 175 1736 1696 1847 1626 1.605 1.506 1528 2.941 2884 2.829 2725 2673 2024 2577 2531 2487 2402 2.322 2283 2.246 2.174 2.106 3.302 3.808 1717 3548 3405 3.387 3312 3.240 3.170 3.037 2914 255 2798 2800 2.500 Period 5 4853 4.713 4580 4.329 4212 4100 3993 3.890 3.791 3806 3433 3362 Period 6 5795 5601 5417 5242 5076 4917 4767 4623 4486 4355 4111 389 3704 Period 7 6728 6472 6230 6002 5706 5582 5385 5.206 6033 438 4564 4288 4160 Period S 7.852 7.325 7.000 6.733 6.463 6210 6371 5747 5536 5335 496 4530 4487 Period 8.566 6.162 7706 7.435 7.108 6802 6515 6247 5995 5.758 5328 4946 4772 4607 4303 4001 4344 4078 3837 Period 10 9471 8.983 8530 4.111 7.722 7.360 7.004 6710 6418 6345 5650 5216 5019 4833 444 4102 Period 11 10.368 9.787 9.253 8.760 4306 7887 7.499 7.139 6805 6496 5.938 5453 5234 5.029 4656 4327 Period 12 11.255 10.575 9.954 9385 8863304 7.343 7.536 7.101 6514 614 5860 5421 5.197 4733 4.439 Period 13 12.134 11.345 10.635 9.906 9.394 8853 8358 7.904 7.487 7.103 6424 5842 5583 6342 4910 4533 Period 14 13.004 12.100 11.296 10.563 9899 295 745 6244 7.786 7.367 6628 0.002 5724 548 5008 4611 Period 15 13.865 12.849 11.838 11.118 10.340 9712 8.108 8.550 8061 2800 6811 6.142 5847 5575 6082 4675 Period 16 14.718 13.578 12.561 11.652 10.838 10 106 9447 8851 8313 7824 6974 6205 5964 5809 5162 4730 15.582 14.292 13.166 12.106 11.274 10477 9.763 9122 8544 022 7.120 373 4047 5740 5222 4775 16.396 14.092 13.754 12.659 11.600 10 828 10.059 372 8756 8201 7250 4467 6.128 5318 5273 4812 17 226 15.678 14.324 13 134 12.085 11.158 10.336 9.604 950 6365 7.366 4550 6150 5877 6316 4844 Period 28 18.046 18.351 14.877 13.580 12.462 11.470 10.594 981 9.129 6514 7.468 6623 6259 5929 6353 4870 Period 21 18.857 17.011 15.415 14.029 12 821 11764 10.830 10017 5292 8849 7562 6087 6312 5373 5384 4891 Period 22 10 600 17.456 15.837 14.451 13.183 12.042 11.061 10.201 442 8772 7645 6743 360 6011 5410 4.909 Period 23 20.456 18.202 15.444 14 857 13.400 12.303 11.272 10.371 580 6.385 7.718 6792 6309 6044 5422 4.8251 Period 24 21.243 18.914 16.936 15 247 13.796 12.580 11.469 10.529 8707 6385 7764 6835 6434 6073 5451 4937 3.274 3.127 2.991 3885 3400 3.336 fors to three decimal places, XX0x Round 4.039 3812 3.605 he nearest whole dolar Print Done Next Preston Company is considering acquiring a manufacturing plant. The purchase price is $1,000,000. The owners believe the plant will generate net cash inflows of $307,000 annually. It will have to be replaced in 6 years. Use the payback method to determine whether Preston Company should purchase this plant. Round to one decimal place. Select the formula, then enter the amounts to calculate the payback period for the plant (Round payback to one decimal place, XX) The payback occurs the plant must be replaced, so the payback method exactly when well after well before Payback years purchasing the plant Your grandfather would like to share some of his fortune with you. He offers to give you money under one of the following scenarios (you get to choose) 1. $8,250 per year at the end of each of the next 8 years 2. $50,100 (ump sum) now 3. $99,850 (lump sum) 8 years from now Read the requirements View the Present Value of $1 table View the Proser Value of Ordinary Acuity of stable Requirement 1. Calculate the present value of each scenario using a 6% discount rate. Which scenario yields the highest present value? (Round the factors to three decimal places, XXXX Round the present value to the nearest whole dollar.) Scenario 1, 6% discount rate, Present value Scenario 2,6% discount rate, Present value Scenario 3, 6% discount rate. Present value appears to be the best option. Based on a 6% interest rate, its present value is the Requirement 2. Would your preference change if you used a 12% discount rate? Compute the present value of each scenario using a 12% discount rate. (Round the factors to three decimal places, XXXXX Round the present value to the nearest whole dollar) Scenario 1, 12% discount rate, Present value Scenario 2, 12% discount rate, Present value Scenario 3, 12% discount rate, Present value appears to be the best option. Based on a 12% interest rate, its present value is the Next 23 Face to face iz Present Value of $1 Question 3 ots This quiz: 10 points) possible e - X Present Value of $1 Periods Period 1 Period 2 1% 2% 3% 4% 5% 0% Parfod 3 Period 4 16% 7% 8% 9% 10% 12% 14% 15% 18% 20% 0.990 0.960 0.971 0.962 0.952 0.943 0.935 0.826 0.917 0909 0.853 0.877 0870 0.882 0.047 0833 0.980 0.561 0.943 0.925 0.907 0.890 0.873 0.857 0.842 0826 0.767 0.769 0.756 0743 0.718 0.654 0.971 0.942 0.915 0.889 0.864 0.840 0816 0.794 0772 0.751 0712 0675 0.658 0.641 0.609 0.579 0961 0.924 0888 0.855 0823 0782 0.763 0.735 0.708 0.683 0.638 0.592 0572 0.552 0516 0.482 Period 5 0.951 0.906 0.865 0822 0.764 0.747 0713 0881 0.050 0821 0.567 0.519 0.497 0.476 0.437 0402 Period 0.342 0.858 0.837 0.790 0.746 0705 0.666 0.630 0.59 0.564 0.507 0.456 0432 0410 0.370 0.335 Period 7 0.333 0.871 0.813 0.760 0.711 0.665 0623 0.583 0.547 0513 0.452 0.400 0.376 0354 0314 0.279 Period 0.923 0.853 0.789 0731 0.677 0.627 0.582 0.540 0.502 0467 0404 0.361 0.327 0305 0296 0.233 Parlod 9 0914 0.837 0.756 0.703 0645 0.592 0544 0.500 0.460 0.424 0361 0.308 0.284 0.263 0.225 0194 Period 10 0805 0.820 0.744 0.676 0614 0.558 0.508 0463 0422 0.386 0322 0270 0247 0.227 0.191 0162 Period 11 0.396 0.804 0.722 0.650 0.585 0.527 0475 0429 0369 0.350 0287 0237 0215 0136 0.162 0.135 Period 12 0.887 0.788 0701 0625 0.557 0.497 0444 0.387 0358 0319 0.257 0208 0.167 0.168 0137 0.112 Period 13 0.879 0.773 0.681 0.605 0.530 0.409 0415 0.368 0326 0290 0.229 0182 0163 0.145 0.116 6093 Period 14 0.670 0.758 0.661 0577 0.506 0442 0.388 0.342 0299 0263 0.205 0160 0141 0.125 0.099 0.078 Period 15 0.861 0743 0642 0555 0481 0.417 0.362 0.315 0275 0239 0.183 0.140 0123 0108 0.064 0.065 Period 16 0.853 0.728 0.625 0.534 0.458 0.394 0.339 0.292 0.252 0218 0.163 0.123 0.107 0.083 0.01 0.054 Period 17 0844 0.714 0.805 0.513 0.436 0371 0317 0.270 0231 0196 0.146 0.100 0.093 0.080 0.060 0.045 Period 18 0836 0.700 0.587 0.494 0416 0.350 0.296 0.250 0.212 0180 0130 0.095 0.081 0.069 0.051 0.038 Period 19 0.828 0886 0.570 0475 0.396 0331 0277 0.232 0.194 0164 0.116 0.083 0.070 0060 0.043 0.031 Period 20 0.820 0873 0554 0456 0377 0312 0258 0215 0.178 0.149 0.504 0.073 0.001 0.055 0.037 0.029 Period 21 0.811 0.060 0.538 0439 0.359 0294 0242 0.199 0.164 0.135 0.083 0.064 0.063 0.044 0.001 0.022 Period 22 0.803 0647 0522 0422 0342 0278 0226 0.154 0.150 0.123 0083 0056 0046 0.038 0.026 0.018 Period 23 0.786 0.634 0.507 0.406 0326 0262 0211 0.170 0.138 0112 0.074 0.049 0.040 0.033 0022 0.015 Period 24 0.788 0.622 0482 0.390 0310 0247 0187 0.158 0125 0.102 0.066 0.043 0.035 0.028 0.019 0.013 band 35 la anlasalaala Lanon In Insen In the Incas Lana na nas lama lansa Inom Print Done Maryam Habhab Submit quiz tors to three decimal places, XXXXX, Round the nearest whole dolar.) Next pearson.com Fall 23 Face to face 1 quiz Chioter 11.02 400/Wand 240334150 Question 2nd This quiz: 10 points possible Present Value of Ordinary Annuity of $1 Maryam Habhab Submit quiz Periods 1% Period 1 Period 21 1856 Period 3 2775 Period 4 3630 4.452 Period 17 Period 18 Period 13 Present Value of Ordinary Annuity of $1 2% 3% 4% $% 0% 7% 0% 9% 10% 0990 0.980 0.971 0.962 0.962 0345 0835 0926 0917 0909 0.890877 0870 0M2 0.47 0.833 12% 14% 15% 10% 18% 20% 1970 1.942 1913 1859 1833 180 1783 175 1736 1696 1847 1626 1.605 1.506 1528 2.941 2884 2.829 2725 2673 2024 2577 2531 2487 2402 2.322 2283 2.246 2.174 2.106 3.302 3.808 1717 3548 3405 3.387 3312 3.240 3.170 3.037 2914 255 2798 2800 2.500 Period 5 4853 4.713 4580 4.329 4212 4100 3993 3.890 3.791 3806 3433 3362 Period 6 5795 5601 5417 5242 5076 4917 4767 4623 4486 4355 4111 389 3704 Period 7 6728 6472 6230 6002 5706 5582 5385 5.206 6033 438 4564 4288 4160 Period S 7.852 7.325 7.000 6.733 6.463 6210 6371 5747 5536 5335 496 4530 4487 Period 8.566 6.162 7706 7.435 7.108 6802 6515 6247 5995 5.758 5328 4946 4772 4607 4303 4001 4344 4078 3837 Period 10 9471 8.983 8530 4.111 7.722 7.360 7.004 6710 6418 6345 5650 5216 5019 4833 444 4102 Period 11 10.368 9.787 9.253 8.760 4306 7887 7.499 7.139 6805 6496 5.938 5453 5234 5.029 4656 4327 Period 12 11.255 10.575 9.954 9385 8863304 7.343 7.536 7.101 6514 614 5860 5421 5.197 4733 4.439 Period 13 12.134 11.345 10.635 9.906 9.394 8853 8358 7.904 7.487 7.103 6424 5842 5583 6342 4910 4533 Period 14 13.004 12.100 11.296 10.563 9899 295 745 6244 7.786 7.367 6628 0.002 5724 548 5008 4611 Period 15 13.865 12.849 11.838 11.118 10.340 9712 8.108 8.550 8061 2800 6811 6.142 5847 5575 6082 4675 Period 16 14.718 13.578 12.561 11.652 10.838 10 106 9447 8851 8313 7824 6974 6205 5964 5809 5162 4730 15.582 14.292 13.166 12.106 11.274 10477 9.763 9122 8544 022 7.120 373 4047 5740 5222 4775 16.396 14.092 13.754 12.659 11.600 10 828 10.059 372 8756 8201 7250 4467 6.128 5318 5273 4812 17 226 15.678 14.324 13 134 12.085 11.158 10.336 9.604 950 6365 7.366 4550 6150 5877 6316 4844 Period 28 18.046 18.351 14.877 13.580 12.462 11.470 10.594 981 9.129 6514 7.468 6623 6259 5929 6353 4870 Period 21 18.857 17.011 15.415 14.029 12 821 11764 10.830 10017 5292 8849 7562 6087 6312 5373 5384 4891 Period 22 10 600 17.456 15.837 14.451 13.183 12.042 11.061 10.201 442 8772 7645 6743 360 6011 5410 4.909 Period 23 20.456 18.202 15.444 14 857 13.400 12.303 11.272 10.371 580 6.385 7.718 6792 6309 6044 5422 4.8251 Period 24 21.243 18.914 16.936 15 247 13.796 12.580 11.469 10.529 8707 6385 7764 6835 6434 6073 5451 4937 3.274 3.127 2.991 3885 3400 3.336 fors to three decimal places, XX0x Round 4.039 3812 3.605 he nearest whole dolar Print Done Next