Current Attempt in Progress Carla Vista Company is performing a post-audit of a project completed one year ago. The initial estimates were that the project would cost $250,000, would have a useful life of 9 years and zero salvage value, and would result in net annual cash flows of $44,200 per year. Now that the investment has been in operation for 1 year, revised figures indicate that it actually cost $263,000, will have a total useful life of 11 years (including the year just completed), and will produce net annual cash flows of $37,700 per year. Click here to view PV table. Evaluate the success of the project. Assume a discount rate of 9% (f the net present value is negative, use either a negative sign preceding the number eg-45 or parentheses eg (45). Round present value answers to 0 decimal places, eg 125. For calculation purposes, use 5 decimal places as displayed in the factor table provided) Original estimate net present value $ Revised estimate net present value $ The project a success
Current Attempt in Progress Carla Vista Company is performing a post-audit of a project completed one year ago. The initial estimates were that the project would cost $250,000, would have a useful life of 9 years and zero salvage value, and would result in net annual cash flows of $44,200 per year. Now that the investment has been in operation for 1 year, revised figures indicate that it actually cost $263,000, will have a total useful life of 11 years (including the year just completed), and will produce net annual cash flows of $37,700 per year. Click here to view PV table. Evaluate the success of the project. Assume a discount rate of 9% (f the net present value is negative, use either a negative sign preceding the number eg-45 or parentheses eg (45). Round present value answers to 0 decimal places, eg 125. For calculation purposes, use 5 decimal places as displayed in the factor table provided) Original estimate net present value $ Revised estimate net present value $ The project a success
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
Related questions
Question
Munabhai
Transcribed Image Text:Current Attempt in Progress
Carla Vista Company is performing a post-audit of a project completed one year ago. The initial estimates were that the project would
cost $250,000, would have a useful life of 9 years and zero salvage value, and would result in net annual cash flows of $44,200 per
year. Now that the investment has been in operation for 1 year, revised figures indicate that it actually cost $263,000, will have a total
useful life of 11 years (including the year just completed), and will produce net annual cash flows of $37,700 per year. Click here to
view PV table.
Evaluate the success of the project. Assume a discount rate of 9%. (If the net present value is negative, use either a negative sign preceding
the number eg -45 or parentheses eg (45). Round present value answers to 0 decimal places, e.g. 125. For calculation purposes, use 5 decimal
places as displayed in the factor table provided.)
Original estimate net present value
Revised estimate net present value
The project
a success
$
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 3 steps
Recommended textbooks for you
Essentials Of Investments
Finance
ISBN:
9781260013924
Author:
Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:
Mcgraw-hill Education,
Essentials Of Investments
Finance
ISBN:
9781260013924
Author:
Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:
Mcgraw-hill Education,
Foundations Of Finance
Finance
ISBN:
9780134897264
Author:
KEOWN, Arthur J., Martin, John D., PETTY, J. William
Publisher:
Pearson,
Fundamentals of Financial Management (MindTap Cou…
Finance
ISBN:
9781337395250
Author:
Eugene F. Brigham, Joel F. Houston
Publisher:
Cengage Learning
Corporate Finance (The Mcgraw-hill/Irwin Series i…
Finance
ISBN:
9780077861759
Author:
Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor
Publisher:
McGraw-Hill Education