1
answer
0
watching
78
views
28 Sep 2019
New Hampshire Company is considering two investments. Therelevant data follows:
ProjectA Project B
Cost $200,000 $300,000
Annual cash savings(end ofyear) $50,692 $60,995
Terminal salvagevalue $50,000 $70,000
Estimated useful life inyears 5 5
Minimum desired rate ofreturn 10% 10%
Method ofdepreciation Straight-line Straight-line
PresentValue Present Value
Of$1 of Ordinary
for 5periods Annuity of $1
for 5 periods
5% 0.7835 4.3295
6% 0.7473 4.2124
7% 0.713 4.1002
8% 0.6806 3.9927
10% 0.6209 3.7908
12% 0.5674 3.6048
14% 0.5194 3.4331
Ignore taxes. Using the net present value method, which projectshould be accepted? SHOW WORK
| New Hampshire Company is considering two investments. Therelevant data follows: ProjectA Project B Cost $200,000 $300,000 Annual cash savings(end ofyear) $50,692 $60,995 Terminal salvagevalue $50,000 $70,000 Estimated useful life inyears 5 5 Minimum desired rate ofreturn 10% 10% Method ofdepreciation Straight-line Straight-line PresentValue Present Value Of$1 of Ordinary for 5periods Annuity of $1 for 5 periods 5% 0.7835 4.3295 6% 0.7473 4.2124 7% 0.713 4.1002 8% 0.6806 3.9927 10% 0.6209 3.7908 12% 0.5674 3.6048 14% 0.5194 3.4331 Ignore taxes. Using the net present value method, which projectshould be accepted? SHOW WORK | ||
Keith LeannonLv2
28 Sep 2019