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Lopez Company. is interested in purchasing equipment that would improve its operational efficiency. The cost...

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Accounting

Lopez Company. is interested in purchasing equipment that would improve its operational efficiency. The cost of the equipment is $400,000 with an estimated residual value of$30,000 and a useful life of 10 years. The equipment is expected to fetch cash inflows of $60,000 a year. The company's minimum rate of return is 8 percent. The present value of$1 for 10 years at 8 percent is 0.463 and the present value of an annuity of $1 at 8 percent and 10 years is 6.710. Using this information for Lopez, the net present value of the project is ___________

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