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Pena Company is considering an investment of $29,480 that provides net cash flows of $8,900 annually for four years. (a) If Pena Company requires a 7% return on its investments, what is the net present value of this investment? (PV of $1. FV of $1. PVA of $1, and EVA of $1) (Use appropriate factor(s) from the tables provided. Round your present value factor to 4 decimals.) (b) Based on net present value, should Pena Company make this investment? Complete this question by entering your answers in the tabs below. Required A Required 6 What is the net present value of this investment? PV Factor Years 1-4 Net present value Net Cash Flows Required A = Present Value of Net Cash Flows Required B >

Pena Company is considering an investment of $29,480 that provides net cash flows of $8,900 annually for four years. (a) If Pena Company requires a 7% return on its investments, what is the net present value of this investment? (PV of $1. FV of $1. PVA of $1, and EVA of $1) (Use appropriate factor(s) from the tables provided. Round your present value factor to 4 decimals.) (b) Based on net present value, should Pena Company make this investment? Complete this question by entering your answers in the tabs below. Required A Required 6 What is the net present value of this investment? PV Factor Years 1-4 Net present value Net Cash Flows Required A = Present Value of Net Cash Flows Required B >

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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Pena Company is considering an investment of $29,480 that provides net cash flows of $8,900 annually for four years. (a) If Pena Company requires a 7% return on its investments, what is the net present value of this investment? (PV of $1. EV of $1. PVA of $1, and EVA of $1) (Use appropriate factor(s) from the tables provided. Round your present value factor to 4 decimals.) (b) Based on net present value, should Pena Company make this investment? Complete this question by entering your answers in the tabs below. Required A Required 6 What is the net present value of this investment? PV Factor Years 1-4 Net present value Net Cash Flows Required A = Present Value of Net Cash Flows Required B >
Transcribed Image Text:Pena Company is considering an investment of $29,480 that provides net cash flows of $8,900 annually for four years. (a) If Pena Company requires a 7% return on its investments, what is the net present value of this investment? (PV of $1. EV of $1. PVA of $1, and EVA of $1) (Use appropriate factor(s) from the tables provided. Round your present value factor to 4 decimals.) (b) Based on net present value, should Pena Company make this investment? Complete this question by entering your answers in the tabs below. Required A Required 6 What is the net present value of this investment? PV Factor Years 1-4 Net present value Net Cash Flows Required A = Present Value of Net Cash Flows Required B >
Pena Company is considering an investment of $29,480 that provides net cash flows of $8,900 annually for fa (a) If Pena Company requires a 7% return on its investments, what is the net present value of this investment? of $1. and FVA of $1) (Use appropriate factor(s) from the tables provided. Round your present value factor te (b) Based on net present value, should Pena Company make this investment? Complete this question by entering your answers in the tabs below. Required A Required B Based on net present value, should Pena Company make this investment? Based on net present value, should Pena Company make this investment? < Required A < Prev 19 of 12 Required B > Next
Transcribed Image Text:Pena Company is considering an investment of $29,480 that provides net cash flows of $8,900 annually for fa (a) If Pena Company requires a 7% return on its investments, what is the net present value of this investment? of $1. and FVA of $1) (Use appropriate factor(s) from the tables provided. Round your present value factor te (b) Based on net present value, should Pena Company make this investment? Complete this question by entering your answers in the tabs below. Required A Required B Based on net present value, should Pena Company make this investment? Based on net present value, should Pena Company make this investment? < Required A < Prev 19 of 12 Required B > Next
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