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Calculation of NPV
(1) NPV = present value of cash inflow - present value of cash outflow
= $409075.1 - $385000
= $24075.07
(2)IRR = 12.34 %
(3) MIRR + 13.33%
Working note.1 calculation of cash outflow & cash inflow
Cash outflow = 350000+35000 = 385000
Cash inflows = 110000*.75*3.7908 + 68000*0.621+54106.07
= 409075.1
Madison Manufacturing is considering a new machine that costs $350,000 and would reduce pre-tax manufacturing costs...
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