Bruce is considering the purchase of a restaurant named Hard Rock Hollywood. With the help of his accountant, Bruce projects the net cash flows (cash inflows less cash outflows) from the restaurant to be the following amounts over the next 10 years: Years 1 to 6 7 8 9 10 Amount $93,000 (each year) 103,000 113,000 123,000 133,000 Bruce expects to sell the restaurant after 10 years for an estimated $1,230,000. (FV of $1, PV of $1. EVA of $1. and PVA of $1) (Use tables, Excel, or a financial calculator. Round your answer to 2 decimal places.) Required: 1-a. Calculate the total present value of the net cash flows if Bruce wants to make at least 12% annually on his investment. (Assume all cash flows occur at the end of each year. Be sure to include the selling price in your calculation.) 1-b. Assuming the restaurant is listed for sale at $1,050,000, should he purchase the restaurant? Complete this question by entering your answers in the tabs below. Req 1A Calculate the total present value of the net cash flows if Bruce wants to make at least 12% annually on his investment. (Assume all cash flows occur at the end of each year. Be sure to include the selling price in your calculation.) Total present value Req 18 Reg 1A Req 18 >

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Cash Flow Statement Analysis

A company's cash flow is the movement of its cash inflows and cash outflows. A cash flow statement is prepared to determine changes in an organization's cash position. A cash flow statement shows how much money was generated and spent on the business during the fiscal year. The cash flow analysis is a method of analyzing an organization's investing, financing, and operating activities. A cash flow statement reveals an organization's liquidity and solvency, as well as its ability to change cash flows in the future. It eliminates the other effects of accounting methods by improving the comparability of different organizations' operational performance.