Project C1 | |||
Initial Investment | 336000 | ||
i | 8% | ||
Year | Cash Inflow | PV Factor | PV |
1 | 48000 | 0.9259 | 44443.2 |
2 | 144000 | 0.8573 | 123451.2 |
3 | 204000 | 0.7938 | 161935.2 |
Present value of cash inflows | 329829.6 | ||
Less: Initial Investment | 336000 | ||
NPV | -6170.4 | ||
Should acquire? | No | ||
Project C2 | |||
Initial Investment | 336000 | ||
i | 8% | ||
Year | Cash Inflow | PV Factor | PV |
1 | 132000 | 0.9259 | 122218.8 |
2 | 132000 | 0.8573 | 113163.6 |
3 | 132000 | 0.7938 | 104781.6 |
Present value of cash inflows | 340164 | ||
Less: Initial Investment | 336000 | ||
NPV | 4164 | ||
Should acquire? | Yes | ||
Project C3 | |||
Initial Investment | 336000 | ||
i | 8% | ||
Year | Cash Inflow | PV Factor | PV |
1 | 216000 | 0.9259 | 199994.4 |
2 | 96000 | 0.8573 | 82300.8 |
3 | 84000 | 0.7938 | 66679.2 |
Present value of cash inflows | 348974.4 | ||
Less: Initial Investment | 336000 | ||
NPV | 12974.4 | ||
Should acquire? | Yes |
Projects with positive NPV must be accepted while those with negative NPV should be rejected
Phoenix Company can invest in each of three cheese-making projects: C1, C2, and C3. Each project...
Phoenix Company can invest in each of three cheese-making projects: C1, C2, and C3. Each project requires an initial investment of $258,000 and would yield the following annual cash flows. (PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided.) Year 1 Year 2 Year 3 C1 $ 22,000 118,000 178,000 $318,000 C2 $ 106,000 106,000 106,000 $318,000 C3 $190.000 70,000 58,000 $318,000 Totals (1) Assume that the company requires...
Phoenix Company can invest in each of three cheese-making projects: C1, C2, and C3. Each project requires an initial investment of $270,000 and would yield the following annual cash flows (PV of $1. FV of $1. PVA of $1, and EVA of $1) (Use appropriate factor(s) from the tables provided.) C1 C2 Year Year 2 Year 3 Totals $ 26,000 122,000 182,000 $330,000 $110,000 110,000 110, eee $330,000 C3 $194,000 74,000 62,000 $330,000 (1) Assume that the company requires a...
Phoenix Company can invest in each of three cheese-making projects: C1, C2, and C3. Each project requires an initial investment of $222,000 and would yield the following annual cash flows. (PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided.) ci Year 1 Year 2 Year 3 Totals $ 10,000 106,000 166,000 $282,000 C2 $ 94,000 94,000 94,000 $282,000 C3 $178,000 58,000 46,000 $282,000 (1) Assume that the company requires...
Phoenix Company can invest in each of three cheese-making projects: C1, C2, and C3. Each project requires an initial investment of $306,000 and would yield the following annual cash flows. (PV of $1. FV of $1. PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided.) Year 1 Year 2 Year 3 Totals C1 $ 38,000 134,000 194,000 $366,000 $122,000 122,000 122,000 $366,000 C3 $206,000 86,000 74,000 $366,000 (1) Assume that the company requires a 9%...
Phoenix Company can invest in each of three cheese-making projects: C1, C2, and C3. Each project requires an initial investment of $228,000 and would yield the following annual cash flows. (PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided.) C2 Year 1 Year 2 Year 3 Totals ci $ 12,000 108,000 168,000 $288,000 $ 96,000 96,000 96,000 $288,000 C3 $180,000 60,000 48,000 $288,000 (1) Assume that the company requires...
Phoenix Company can invest in each of three cheese-making projects: C1, C2, and C3. Each project requires an initial investment of $330,000 and would yield the following annual cash flows. (PV of $1. FV of S1. PVA of S1. and EVA of Si) (Use appropriate factor(s) from the tables provided.) Year 1 Year 2 Year 3 Totals 46,000 $130,000 $214,000 142,000130,000 202,000 94,000 130,00082,000 390,000 $390,000 $390,000 a 5% return from its investments, using net present value, determine which Assume...
A company can invest in each of three cheese-making projects: C1, C2 and C3. Each project requires an initial investment of $312,000 and would yield the following annual cash flows. (PV of $1, FV of $1, PVA of $1, and FVA of $1) Year 1 Year 2 Year 3 Totals ci $ 40,000 136,000 196,000 $372,000 c2 $124,000 124,000 124,000 $372,000 $208,000 88,000 76,000 $372,000 1. Assume that the company requires a 9% return from its investments. Using net present...
i was not given the PV factor table Phoenix Company can invest in each of three cheese-making projects: C1, C2, and C3. Each project requires an initial investment of $264,000 and would yield the following annual cash flows PV of $1. FV of $1. PVA of $1, and EVA of S1) (Use appropriate factor(s) from the tables provided.) Year 1 $ 24,000 120,000 180.00 5108,000 1e8,eee les.ee $324.ee $ 192,000 72.000 60,000 $324.000 $324.00 1. Assume that the company requires...
Following is information on two alternative investments being considered by Jolee Company. The company requires a 6% return from its investments. (PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided.) Project A $ (186,325) Project B $ (151,960) Initial investment Expected net cash flows in: Year 1 Year 2 Year 3 Year 4 Year 5 50,000 53,000 83,295 80,400 71,000 27,000 60,000 64,000 68,000 30,000 a. For each alternative...
Following is information on two alternative investments being considered by Jolee Company. The company requires a 10% return from its investments. (PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided.) Project A $(184,325) Project B $(157,960) Initial investment Expected net cash flows in: Year 1 Year 2 Year 3 Year 4 Year 5 41,000 41,000 89, 295 80,400 55,000 42,000 45,000 64,000 75,000 38,000 a. For each alternative project...