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11-9 Exercise 11-9 Computing net present value LO P3 828 Co....

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Accounting

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Exercise 11-9 Computing net present value LO P3 828 Co. is considering the purchase of equipment that would allow the company to add a new product to its line. The equipment is expected to cost $376,000 with a 8-year life and no salvage value. It will be depreciated on a straight-line basis. The company expects to sell 150,400 units of the equipment's product each year. The expected annual income related to this equipment follows Sales Costs s 235,60e Materials, labor, and overhead (except depreciation on new equipment) Selling and administrative expenses Total costs and expenses Pretax income Income taxes (306) Net income 82,000 47,600 23,569 152,500 82,5e0 24,750 57,75e If at least an 9% return on this investment must be earned, compute the net present value of this investment most EV of$1. PVAof S1. and FVA of S) (Use appropriate factor(s) from the tables provided.) PV Factor Present Value Net present value ?Prey 1of 1111 Next >

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