Condor Company is considering an investment in a project that has an internal rate of return of 12%. The project has a 5-year useful life but has no salvage value. Cash inflows from this project are $20,000 per year in each of the 5 years. Condor uses a 14% discount rate to make capital budgeting decisions. What is the net present value of this project? O $(3,440) O $(11,340) O $6,880 O $7.900 O None of the above

Condor Company is considering an investment in a project that has an internal rate of return of 12%. The project has a 5-year useful life but has no salvage value. Cash inflows from this project are $20,000 per year in each of the 5 years. Condor uses a 14% discount rate to make capital budgeting decisions. What is the net present value of this project? O $(3,440) O $(11,340) O $6,880 O $7.900 O None of the above

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

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Condor Company is considering an investment in a project that has an internal rate of return of 12%.
The project has a 5-year useful life but has no salvage value. Cash inflows from this project are
$20,000 per year in each of the 5 years. Condor uses a 14% discount rate to make capital budgeting
decisions. What is the net present value of this project?
O $(3,440)
O $(11,340)
O $6,880
O $7.900
O None of the above

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