Gomez is considering a $240,000 investment with the following net cash flows. Gomez requires a 12% return on its investments. (PV of $1, FV of $1, PVA of $1, and FVA of $1) Note: Use appropriate factor(s) from the tables provided. Net cash flows Year 1 $83,000 Year 2 $43,000 Year 3 Year 4 $82,000 $172,000 Year 5 $53,000 (a) Compute the net present value of this investment. (b) Should Gomez accept the investment? Complete this question by entering your answers in the tabs below. Required A Required B Compute the net present value of this investment. Note: Round your answers to the nearest whole dollar. Net Cash Year Flows Present Value of 1 at 12% Present Value of Net Cash Flows Year 1 $ 83,000 Year 2 43,000 Year 3 82,000 Year 4 172,000 Year 5 53,000 Totals $ 433,000 $ 0 Initial investment Net present value $ 0 < Required A Required B >
Gomez is considering a $240,000 investment with the following net cash flows. Gomez requires a 12% return on its investments. (PV of $1, FV of $1, PVA of $1, and FVA of $1) Note: Use appropriate factor(s) from the tables provided. Net cash flows Year 1 $83,000 Year 2 $43,000 Year 3 Year 4 $82,000 $172,000 Year 5 $53,000 (a) Compute the net present value of this investment. (b) Should Gomez accept the investment? Complete this question by entering your answers in the tabs below. Required A Required B Compute the net present value of this investment. Note: Round your answers to the nearest whole dollar. Net Cash Year Flows Present Value of 1 at 12% Present Value of Net Cash Flows Year 1 $ 83,000 Year 2 43,000 Year 3 82,000 Year 4 172,000 Year 5 53,000 Totals $ 433,000 $ 0 Initial investment Net present value $ 0 < Required A Required B >
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
man.9
Transcribed Image Text:Gomez is considering a $240,000 investment with the following net cash flows. Gomez requires a 12% return on its investments. (PV of
$1, FV of $1, PVA of $1, and FVA of $1)
Note: Use appropriate factor(s) from the tables provided.
Net cash flows
Year 1
$83,000
Year 2
$43,000
Year 3
Year 4
$82,000
$172,000
Year 5
$53,000
(a) Compute the net present value of this investment.
(b) Should Gomez accept the investment?
Complete this question by entering your answers in the tabs below.
Required A
Required B
Compute the net present value of this investment.
Note: Round your answers to the nearest whole dollar.
Net Cash
Year
Flows
Present
Value of 1
at 12%
Present Value
of Net Cash
Flows
Year 1
$
83,000
Year 2
43,000
Year 3
82,000
Year 4
172,000
Year 5
53,000
Totals
$ 433,000
$
0
Initial investment
Net present value
$
0
< Required A
Required B >
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