Dunay Corporation is considering investing $510,000 in a project. The life of the project would be 4 years. The project would require additional working capital of $24,000, which would be released for use elsewhere at the end of the project. The annual net cash inflows would be $162,000. The salvage value of the assets used in the project would be $41,000. The company uses a discount rate of 10%.
Required:
Compute the net present value of the project.

Question

Quizplus · Accepted Answer

The Answer of Dunay Corporation is considering investing $510,000 in a project. The life of the project would be 4 years. The project would require additional working capital of $24,000, which would be released for use elsewhere at the end of the project. The annual net cash inflows would be $162,000. The salvage value of the assets used in the project would be $41,000. The company uses a discount rate of 10%.
Required:
Compute the net present value of the project.

Dunay Corporation Is Considering Investing $510,000 in a Project