The following information relates to three mutually exclusive projects. $\begin{array}{rrrr}& \text { Project } A & \text { Project } B & \text { Project C } \
\text { Initial cash outlay } & \$ 40,000 & \$ 40,000 & \$ 40,000\
\text { Net cash inflows: }\
year1 & 3,000 & 16,000 & 12,000 \
2 & 7,000 & 13,000 & 12,000 \
3 & 11,000 & 10,000 & 12,000 \
4 & 15,000 & 7,000 & 12,000 \
5 & 19,000 & 4,000 & 12,000\
\text { Salvage value Year } 5&8,000 & \text { Nil } & 2,000
\end{array}$ REQUIRED:
$\text { Compute the net present value of each project at a discount rate of } 10 \% \text {. }$

Question

The following information relates to three mutually exclusive projects. $\begin{array}{rrrr}& \text { Project } A & \text { Project } B & \text { Project C } \
\text { Initial cash outlay } & \$ 40,000 & \$ 40,000 & \$ 40,000\
\text { Net cash inflows: }\
year1 & 3,000 & 16,000 & 12,000 \
2 & 7,000 & 13,000 & 12,000 \
3 & 11,000 & 10,000 & 12,000 \
4 & 15,000 & 7,000 & 12,000 \
5 & 19,000 & 4,000 & 12,000\
\text { Salvage value Year } 5&8,000 & \text { Nil } & 2,000
\end{array}$ REQUIRED: 
$\text { Compute the net present value of each project at a discount rate of } 10 \% \text {. }$

Quizplus · Accepted Answer

The Answer of The following information relates to three mutually exclusive projects. $\begin{array}{rrrr}& \text { Project } A & \text { Project } B & \text { Project C } \
\text { Initial cash outlay } & \$ 40,000 & \$ 40,000 & \$ 40,000\
\text { Net cash inflows: }\
year1 & 3,000 & 16,000 & 12,000 \
2 & 7,000 & 13,000 & 12,000 \
3 & 11,000 & 10,000 & 12,000 \
4 & 15,000 & 7,000 & 12,000 \
5 & 19,000 & 4,000 & 12,000\
\text { Salvage value Year } 5&8,000 & \text { Nil } & 2,000
\end{array}$ REQUIRED: 
$\text { Compute the net present value of each project at a discount rate of } 10 \% \text {. }$