Following is information on an investment considered by Hudson Co. The investment has zero salvage value....

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Accounting

Following is information on an investment considered by HudsonCo. The investment has zero salvage value. The company requires a6% return from its investments.

Investment A1
Initial investment$(360,000)
Expected net cash flows inyear:
1150,000
2146,000
3101,000

Compute this investment’s net present value. (PV of $1, FV of$1, PVA of $1, and FVA of $1) (Use appropriate factor(s)from the tables provided. Round all present value factors to 4decimal places.)

Cash FlowPresent Value of 1 at 6%Present Value
Year 1
Year 2
Year 3
Totals$0$0
Amount invested
Net present value$0

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4.5 Ratings (789 Votes)
The NPV of an investment Present value of cash inflows Present value of cash outflows Here Cash inflows includes future economic benefits that an investment can generate Cash outflows includes initial investment    See Answer
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Following is information on an investment considered by HudsonCo. The investment has zero salvage value. The company requires a6% return from its investments.Investment A1Initial investment$(360,000)Expected net cash flows inyear:1150,0002146,0003101,000Compute this investment’s net present value. (PV of $1, FV of$1, PVA of $1, and FVA of $1) (Use appropriate factor(s)from the tables provided. Round all present value factors to 4decimal places.)Cash FlowPresent Value of 1 at 6%Present ValueYear 1Year 2Year 3Totals$0$0Amount investedNet present value$0

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