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Stuart Company is considering investing in two new vans that are expected to generate combined...

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Accounting

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Stuart Company is considering investing in two new vans that are expected to generate combined cash inflows of $26,500 per year. The vans' combined purchase price is $92,000. The expected life and salvage value of each are eight years and $21,000, respectively. Stuart has an average cost of capital of 12 percent. (PV of $1 and PVA of \$1) Note: Use appropriate factor(s) from the tables provided. Required a. Calculate the net present value of the investment opportunity. Note: Negative amount should be indicated by a minus sign. Round your intermediate calculations and final answer to 2 decimal places. b. Indicate whether the investment opportunity is expected to earn a return that is above or below the cost of capital and whether it should be accepted. Present Value of $1 Present Value of an Annuity of $1

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