Question

Help Save & E Che B2B Co. Is c expected to cost $376,000 expects to sell 150,400 units of the equipment's product each year. The expected annual income related to t ng the purchase of equipment that would allow the company to add a new product to its line. The equipment is with a 10-year life and no salvage value. It will be depreciated on a straight-line basis. The company is equipment follows. s 235,000 82,000 37,600 23,500 143,100 91,900 Selling and a Total costs and expenses Income taxes (40%) $ 55,140 lf at least an 9% return on this investment must be earned, compute the net present value of this investment. (PVOSI, $1, and EVAof (Use appropriate factor(s) from the tables provided.) PVAof < Prey 40f 5EEİ Next >

Answer 1

n =	10
i =	9%
Select Chart	Amount	x	PV Factor	=	Present Value
Present Value of an Annuity of 1	$92,740	x	6.4177	=	$595,177
Present value of cash inflows					595177
Present value of cash outflows					-376,000
Net present value					$219,177
*Net income 55140+dep on equip 37600 = 92740