Do not give answer in image Shelby American Industries is considering the acquisition of a new machine that costs $420,000 and has a useful life of 5 years with no salvage value. The incremental netoperating income and incremental net cash flows that would be produced by the machine are:Year 1$539,365$119,365Ⓒ$420,000$330,000Year 2Year 3.Year 4Year 5Incremental NetOperating Income$61,000$67,000$78,000$41,000$83,000Assume cash flows occur uniformly throughout a year except for the initial investment.If the discount rate is 12%, the net present value of the investment is closest to:IncrementalNet Cash Flows$145,000$151,000$162,000$125,000$167,000

Time value of money :— According to this concept, value of money in present day is greater than the…

Shelby American Industries is considering the acquisition of a new machine that costs $420,000 and has a useful life of 5 years with no salvage value. The incremental net operating income and incremental net cash flows that would be produced by the machine are: $539,365 $119,365 Ⓒ$420,000 Year 1 $330.000 Year 2 Year 3 Year 4 Year 5 Incremental Net Operating Income $61,000 $67,000 $78,000 $41,000 Assume cash flows occur uniformly throughout a year except for the initial investment. If the discount rate is 12%, the net present value of the investment is closest to: $83,000 Incremental Net Cash Flows $145,000 $151,000 $162,000 $125,000 $167,000

Shelby American Industries is considering the acquisition of a new machine that costs $420,000 and has a useful life of 5 years with no salvage value. The incremental net operating income and incremental net cash flows that would be produced by the machine are: $539,365 $119,365 Ⓒ$420,000 Year 1 $330.000 Year 2 Year 3 Year 4 Year 5 Incremental Net Operating Income $61,000 $67,000 $78,000 $41,000 Assume cash flows occur uniformly throughout a year except for the initial investment. If the discount rate is 12%, the net present value of the investment is closest to: $83,000 Incremental Net Cash Flows $145,000 $151,000 $162,000 $125,000 $167,000

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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