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Pablo Company is considering buying a machine that will yield income of $2,200 and net cash flow of $15,100 per year for three years. The machine costs $50,700 and has an estimated $12,000 salvage value. Pablo requires a 10% return on its investments. Compute the net present value of this investment. (PV of $1, FV of $1, PVA of $1, and FVA of $1)

Pablo Company is considering buying a machine that will yield income of $2,200 and net cash flow of $15,100 per year for three years. The machine costs $50,700 and has an estimated $12,000 salvage value. Pablo requires a 10% return on its investments. Compute the net present value of this investment. (PV of $1, FV of $1, PVA of $1, and FVA of $1)

FINANCIAL ACCOUNTING
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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Pablo Company is considering buying a machine that will yield income of $2,200 and net cash flow of $15,100 per year for three years. The machine costs $50,700 and has an estimated $12,000 salvage value. Pablo requires a 10% return on its investments. Compute the net present value of this investment. (PV of $1, FV of $1, PVA of $1, and FVA of $1)

MONK Assig X M Ques X https X Art Beyond the CI... M Question Mode: M... Table B.1* Present Value of 1 p=1/(1+i)n Periods 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 25 30 35 40 Searc X Scree X https X https X 0.4776 0.3751 0.4120 0.3083 0.3554 0.2534 0.3066 0.2083 https X https X ezto-cf-media.mheducation.com/Media/Connect_Production/bne/accounting/Wild_FAP_25e/Table_B.1_Present_Value_of_1.htm Acct: chapter 4 (C... M Question Mode: Fi... QS 2 X 电商X 洛杉 Rate 1% 2% 6% 7% 8% 9% 10% 12% 15% 0.9901 0.9804 3% 0.9709 0.9426 4% 0.9615 0.9246 0.9434 0.9346 0.9091 0.8929 0.9803 0.9612 5% 0.9524 0.9070 0.8900 0.8890 0.8638 0.8396 0.8885 0.8548 0.8626 0.8219 0.9706 0.9423 0.9151 0.8734 0.8163 0.7629 0.7130 0.9259 0.9174 0.8573 0.8417 0.7938 0.7722 0.7350 0.7084 0.6499 0.8696 0.7561 0.6575 0.5718 0.4972 0.4323 0.9610 0.9238 0.9057 0.8264 0.7972 0.7513 0.7118 0.6830 0.6355 0.6209 0.5674 0.5645 0.5066 0.8227 0.7921 0.7835 0.7462 0.9515 0.7473 0.6806 0.9420 0.8880 0.8375 0.7050 0.6663 0.6302 0.5963 0.7903 0.7599 0.9327 0.8706 0.8131 0.7107 0.6651 0.6227 0.5835 0.5470 0.5132 0.4523 0.3759 0.9235 0.8535 0.7894 0.7307 0.6768 0.6274 0.5820 0.5403 0.5019 0.4665 0.4039 0.3269 0.9143 0.8368 0.7664 0.7026 0.6446 0.5919 0.5439 0.5002 0.4604 0.4241 0.3606 0.2843 0.9053 0.8203 0.7441 0.6756 0.6139 0.5584 0.5083 0.4632 0.4224 0.3220 0.2472 0.3855 0.3505 0.8963 0.8043 0.7224 0.6496 0.5847 0.5268 0.4751 0.4289 0.3875 0.2875 0.2149 0.8874 0.7885 0.7014 0.6246 0.5568 0.4970 0.4440 0.3971 0.2567 0.1869 0.3555 0.3186 0.2897 0.8787 0.7730 0.6810 0.6006 0.5303 0.4688 0.4150 0.3677 0.3262 0.2292 0.1625 0.8700 0.7579 0.6611 0.5775 0.5051 0.4423 0.3878 0.3405 0.2992 0.2633 0.2046 0.1413 0.8613 0.7430 0.6419 0.5553 0.4810 0.4173 0.3624 0.3152 0.2745 0.2394 0.1827 0.1229 0.8528 0.7284 0.6232 0.5339 0.4581 0.3936 0.3387 0.2919 0.2519 0.2176 0.1631 0.1069 0.8444 0.7142 0.6050 0.5134 0.4363 0.3714 0.3166 0.2703 0.2311 0.1978 0.1456 0.0929 0.8360 0.7002 0.5874 0.4936 0.4155 0.3503 0.2959 0.2502 0.2120 0.1799 0.1300 0.0808 0.8277 0.6864 0.5703 0.4746 0.3957 0.3305 0.2765 0.2317 0.1945 0.1635 0.1161 0.0703 0.8195 0.6730 0.5537 0.4564 0.3769 0.3118 0.2584 0.2145 0.1784 0.1486 0.1037 0.0611 0.7798 0.6095 0.2953 0.2330 0.1842 0.1460 0.1160 0.0923 0.0588 0.0304 0.7419 0.5521 0.2314 0.1741 0.1314 0.0994 0.0754 0.0573 0.0334 0.0151 0.1813 0.1301 0.0937 0.0676 0.0490 0.0356 0.0189 0.0075 0.7059 0.6717 0.5000 0.4529 0.1420 0.0972 0.0668 0.0460 0.0318 0.0221 0.0107 0.0037 *Used to compute the present value of a known future amount. For example: How much would you need to invest today at 10% compounded semiannually to accumulate $5,000 in 6 years from today? Using Periods 1 2 3 4 5 6 7 X 9 10 11 12 13 14 15 16 17 18 19 20 25 30 35 40 M Finan X Update :
Transcribed Image Text:MONK Assig X M Ques X https X Art Beyond the CI... M Question Mode: M... Table B.1* Present Value of 1 p=1/(1+i)n Periods 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 25 30 35 40 Searc X Scree X https X https X 0.4776 0.3751 0.4120 0.3083 0.3554 0.2534 0.3066 0.2083 https X https X ezto-cf-media.mheducation.com/Media/Connect_Production/bne/accounting/Wild_FAP_25e/Table_B.1_Present_Value_of_1.htm Acct: chapter 4 (C... M Question Mode: Fi... QS 2 X 电商X 洛杉 Rate 1% 2% 6% 7% 8% 9% 10% 12% 15% 0.9901 0.9804 3% 0.9709 0.9426 4% 0.9615 0.9246 0.9434 0.9346 0.9091 0.8929 0.9803 0.9612 5% 0.9524 0.9070 0.8900 0.8890 0.8638 0.8396 0.8885 0.8548 0.8626 0.8219 0.9706 0.9423 0.9151 0.8734 0.8163 0.7629 0.7130 0.9259 0.9174 0.8573 0.8417 0.7938 0.7722 0.7350 0.7084 0.6499 0.8696 0.7561 0.6575 0.5718 0.4972 0.4323 0.9610 0.9238 0.9057 0.8264 0.7972 0.7513 0.7118 0.6830 0.6355 0.6209 0.5674 0.5645 0.5066 0.8227 0.7921 0.7835 0.7462 0.9515 0.7473 0.6806 0.9420 0.8880 0.8375 0.7050 0.6663 0.6302 0.5963 0.7903 0.7599 0.9327 0.8706 0.8131 0.7107 0.6651 0.6227 0.5835 0.5470 0.5132 0.4523 0.3759 0.9235 0.8535 0.7894 0.7307 0.6768 0.6274 0.5820 0.5403 0.5019 0.4665 0.4039 0.3269 0.9143 0.8368 0.7664 0.7026 0.6446 0.5919 0.5439 0.5002 0.4604 0.4241 0.3606 0.2843 0.9053 0.8203 0.7441 0.6756 0.6139 0.5584 0.5083 0.4632 0.4224 0.3220 0.2472 0.3855 0.3505 0.8963 0.8043 0.7224 0.6496 0.5847 0.5268 0.4751 0.4289 0.3875 0.2875 0.2149 0.8874 0.7885 0.7014 0.6246 0.5568 0.4970 0.4440 0.3971 0.2567 0.1869 0.3555 0.3186 0.2897 0.8787 0.7730 0.6810 0.6006 0.5303 0.4688 0.4150 0.3677 0.3262 0.2292 0.1625 0.8700 0.7579 0.6611 0.5775 0.5051 0.4423 0.3878 0.3405 0.2992 0.2633 0.2046 0.1413 0.8613 0.7430 0.6419 0.5553 0.4810 0.4173 0.3624 0.3152 0.2745 0.2394 0.1827 0.1229 0.8528 0.7284 0.6232 0.5339 0.4581 0.3936 0.3387 0.2919 0.2519 0.2176 0.1631 0.1069 0.8444 0.7142 0.6050 0.5134 0.4363 0.3714 0.3166 0.2703 0.2311 0.1978 0.1456 0.0929 0.8360 0.7002 0.5874 0.4936 0.4155 0.3503 0.2959 0.2502 0.2120 0.1799 0.1300 0.0808 0.8277 0.6864 0.5703 0.4746 0.3957 0.3305 0.2765 0.2317 0.1945 0.1635 0.1161 0.0703 0.8195 0.6730 0.5537 0.4564 0.3769 0.3118 0.2584 0.2145 0.1784 0.1486 0.1037 0.0611 0.7798 0.6095 0.2953 0.2330 0.1842 0.1460 0.1160 0.0923 0.0588 0.0304 0.7419 0.5521 0.2314 0.1741 0.1314 0.0994 0.0754 0.0573 0.0334 0.0151 0.1813 0.1301 0.0937 0.0676 0.0490 0.0356 0.0189 0.0075 0.7059 0.6717 0.5000 0.4529 0.1420 0.0972 0.0668 0.0460 0.0318 0.0221 0.0107 0.0037 *Used to compute the present value of a known future amount. For example: How much would you need to invest today at 10% compounded semiannually to accumulate $5,000 in 6 years from today? Using Periods 1 2 3 4 5 6 7 X 9 10 11 12 13 14 15 16 17 18 19 20 25 30 35 40 M Finan X Update :
Assign X M Questi X Search X MONK Art Beyond the CI... M Question Mode: M... Final: Part 2 (Problems) i 01:00:01 Mc Graw Hill Years 1-3 Screen X Totals https:/ X ezto.mheducation.com/ext/map/index.html?_con=con&external_browser=0&launchUrl=https%253A%252F%252Flms.mheducation.com%252Fmgh... Net present value https:// X Acct: chapter 4 (C... M Question Mode: Fi... https:// X Net Cash Flows 13 Pablo Company is considering buying a machine that will yield income of $2,200 and net cash flow of $15,100 per year for three years. The machine costs $50,700 and has an estimated $12,000 salvage value. Pablo requires a 10% return on its investments. Compute the net present value of this investment. (PV of $1, FV of $1, PVA of $1, and FVA of $1) Note: Use appropriate factor(s) from the tables provided. Negative amounts should be indicated by a minus sign. Round your present value factor to 4 decimals. PV Factor < Prev = = II II = https:/ X C QS 26 X Saved || Present Value of Net Cash Flows $ 13 of 13 电商助 X 0 洛杉矶 × Next > 洛杉矶 × Help Financ X Save & Exit Submit Update :
Transcribed Image Text:Assign X M Questi X Search X MONK Art Beyond the CI... M Question Mode: M... Final: Part 2 (Problems) i 01:00:01 Mc Graw Hill Years 1-3 Screen X Totals https:/ X ezto.mheducation.com/ext/map/index.html?_con=con&external_browser=0&launchUrl=https%253A%252F%252Flms.mheducation.com%252Fmgh... Net present value https:// X Acct: chapter 4 (C... M Question Mode: Fi... https:// X Net Cash Flows 13 Pablo Company is considering buying a machine that will yield income of $2,200 and net cash flow of $15,100 per year for three years. The machine costs $50,700 and has an estimated $12,000 salvage value. Pablo requires a 10% return on its investments. Compute the net present value of this investment. (PV of $1, FV of $1, PVA of $1, and FVA of $1) Note: Use appropriate factor(s) from the tables provided. Negative amounts should be indicated by a minus sign. Round your present value factor to 4 decimals. PV Factor < Prev = = II II = https:/ X C QS 26 X Saved || Present Value of Net Cash Flows $ 13 of 13 电商助 X 0 洛杉矶 × Next > 洛杉矶 × Help Financ X Save & Exit Submit Update :
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