Superior Armored Car Co.is considering the acquisition of a new armored truck.The truck is expected to cost $300,000.The company's discount rate is 12 percent.The firm has determined that the truck generates a positive net present value of $17,022.However,the firm is uncertain as to whether it has determined a reasonable estimate of the salvage value of the truck.In computing the net present value,the company assumed that the truck would be salvaged at the end of the fifth year for $60,000.What expected salvage value for the truck would cause the investment to generate a net present value of $0? Ignore taxes.Present value tables or a financial calculator are required.

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The Answer of Superior Armored Car Co.is considering the acquisition of a new armored truck.The truck is expected to cost $300,000.The company's discount rate is 12 percent.The firm has determined that the truck generates a positive net present value of $17,022.However,the firm is uncertain as to whether it has determined a reasonable estimate of the salvage value of the truck.In computing the net present value,the company assumed that the truck would be salvaged at the end of the fifth year for $60,000.What expected salvage value for the truck would cause the investment to generate a net present value of $0? Ignore taxes.Present value tables or a financial calculator are required.