A $350,000 capital investment proposal has an estimated life of four years and no residual value.The estimated net cash flows are as follows: $$\begin{array} { c c c c }
\text { Year } & \text { Net Cash Flow } & \text { Year } & \text { Net Cash Flow } \
1 & \$ 150,000 & 3 & \$ 104,000 \
2 & 130,000 & 4 & 90,000
\end{array}$$
The minimum desired rate of return for net present value analysis is 12%.The present value of $1 at compound interest of 12% for 1, 2, 3, and 4 years is 0.893, 0.797, 0.712, and 0.636, respectively.Determine the net present value.

Question

A $350,000 capital investment proposal has an estimated life of four years and no residual value.The estimated net cash flows are as follows: $$\begin{array} { c c c c } 
\text { Year } & \text { Net Cash Flow } & \text { Year } & \text { Net Cash Flow } \
1 & \$ 150,000 & 3 & \$ 104,000 \
2 & 130,000 & 4 & 90,000
\end{array}$$ ​
The minimum desired rate of return for net present value analysis is 12%.The present value of $1 at compound interest of 12% for 1, 2, 3, and 4 years is 0.893, 0.797, 0.712, and 0.636, respectively.Determine the net present value.

Quizplus · Accepted Answer

The Answer of A $350,000 capital investment proposal has an estimated life of four years and no residual value.The estimated net cash flows are as follows: $$\begin{array} { c c c c } 
\text { Year } & \text { Net Cash Flow } & \text { Year } & \text { Net Cash Flow } \
1 & \$ 150,000 & 3 & \$ 104,000 \
2 & 130,000 & 4 & 90,000
\end{array}$$ ​
The minimum desired rate of return for net present value analysis is 12%.The present value of $1 at compound interest of 12% for 1, 2, 3, and 4 years is 0.893, 0.797, 0.712, and 0.636, respectively.Determine the net present value.

A $350,000 Capital Investment Proposal Has an Estimated Life of Four