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The following present value factors are provided for use in this problem.   Periods Present Value of $1 at 11% Present Value of an Annuity of $1 at 11% 1   0.9009     0.9009   2   0.8116     1.7125   3   0.7312     2.4437   4   0.6587     3.1024       Cliff Co. wants to purchase a machine for $62,000, but needs to earn a return of 11%. The expected year-end net cash flows are $24,000 in each of the first three years, and $28,000 in the fourth year. What is the machine's net present value?   Multiple Choice $(3,351). $15,093. $77,093. $(43,556). $100,000.

The following present value factors are provided for use in this problem.   Periods Present Value of $1 at 11% Present Value of an Annuity of $1 at 11% 1   0.9009     0.9009   2   0.8116     1.7125   3   0.7312     2.4437   4   0.6587     3.1024       Cliff Co. wants to purchase a machine for $62,000, but needs to earn a return of 11%. The expected year-end net cash flows are $24,000 in each of the first three years, and $28,000 in the fourth year. What is the machine's net present value?   Multiple Choice $(3,351). $15,093. $77,093. $(43,556). $100,000.

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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The following present value factors are provided for use in this problem.
 

Periods Present Value
of $1 at 11%		 Present Value of an
Annuity of $1 at 11%
1   0.9009     0.9009  
2   0.8116     1.7125  
3   0.7312     2.4437  
4   0.6587     3.1024  
 

 
Cliff Co. wants to purchase a machine for $62,000, but needs to earn a return of 11%. The expected year-end net cash flows are $24,000 in each of the first three years, and $28,000 in the fourth year. What is the machine's net present value?

 

Multiple Choice

  • $(3,351).

  • $15,093.

  • $77,093.

  • $(43,556).

  • $100,000.

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