Ames Co. has additional funds that need to be invested, and is considering purchasing an asset that is expected to return $35,000 per year after tax for the next 7 years, with an after-tax disposal value of $40,000. Ames Co.'s required rate of return is 12%.
What is the maximum amount that Ames Co. would be willing to pay to purchase this asset? (Use the appropriate discount factor from Appendix A.)

Question

Ames Co. has additional funds that need to be invested, and is considering purchasing an asset that is expected to return $35,000 per year after tax for the next 7 years, with an after-tax disposal value of $40,000. Ames Co.'s required rate of return is 12%. 
What is the maximum amount that Ames Co. would be willing to pay to purchase this asset? (Use the appropriate discount factor from Appendix A.)

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The Answer of Ames Co. has additional funds that need to be invested, and is considering purchasing an asset that is expected to return $35,000 per year after tax for the next 7 years, with an after-tax disposal value of $40,000. Ames Co.'s required rate of return is 12%. 
What is the maximum amount that Ames Co. would be willing to pay to purchase this asset? (Use the appropriate discount factor from Appendix A.)

Ames Co Has Additional Funds That Need to Be Invested, and and Is