Determine the present value, assuming that John desires a 10% rate of return on this investment. (Assume that all cash flows occur at the end of the year.) (Do not round intermediate calculations. Round your final answers to nearest whole dollar amount.)
John Wiggins is considering the purchase of a small restaurant. The purchase price listed by the seller is $920,000. John has used past financial information to estimate that the net
| Years | Amount | |||
| 1-6 | $ | 92,000 | ||
| 7 | 82,000 | |||
| 8 | 72,000 | |||
| 9 | 62,000 | |||
| 10 | 52,000 | |||
If purchased, the restaurant would be held for 10 years and then sold for an estimated $820,000.
Required:
Determine the present value, assuming that John desires a 10% rate of
Given information is:
Cash outflow = $920,000
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