Company Rapid Growth is considering the following project: Year 0 1 2 3 4 5 Cash Flows -$89300 $10800 $25600 $34000 $35200 $51600 What's the net present value (NPV) of the project, assuming 9.39% discount rate?

Company Rapid Growth is considering the following project: Year 0 1 2 3 4 5 Cash Flows -$89300 $10800 $25600 $34000 $35200 $51600 What's the net present value (NPV) of the project, assuming 9.39% discount rate?

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter12: Capital Investment Analysis

Section: Chapter Questions

Problem 3CMA

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Question

Company Rapid Growth is considering the following project:

Year	0	1	2	3	4	5
Cash Flows	-$89300	$10800	$25600	$34000	$35200	$51600

What's the net present value (NPV) of the project, assuming 9.39% discount rate?

Definition Definition Calculation used to evaluate the investment and financing decisions that involve cash flows occurring over multiple periods. NPV is calculated as the difference between the present value of cash inflow and cash outflow. NPV is used for capital budgeting and investment planning as well as to compare similar investment alternatives.

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