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The following data are accumulated by Geddes Company in evaluating the purchase of $171,300 of...

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Accounting

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The following data are accumulated by Geddes Company in evaluating the purchase of $171,300 of equipment, having a four-year useful life: Net Cash Flow $66,000 51,000 38,000 26,000 Net Income Year 1 Year 2 Year 3 Year 4 $39,000 24,000 11,000 (1,000) Present Value of $1 at Compound Interest 10% 12% 15% 20% 0.9430.909 0.8930.870 0.833 0.8900.8260.797 0.756 0.694 0.840 0.7510.712 0.6580.579 0.7920.683 0.636 0.5720.482 0.747 0.6210.567 0.497 0.402 0.7050.564 0.507 0.432 0.335 7 0.665 0.5130.4520.376 0.279 0.6270.4670.404 0.327 0.233 9 0.592 0.4240.3610.284 0.194 100.558 0.386 0.3220.2470.162 Year 6% 2 4 5 6 8 Check My Work Previous Next a. Assuming that the desired rate of return is 6%, determine the net present value for the proposal. Use the table of the present value of $1 presented above. If required, round to the nearest dollar. Present value of net cash flow Amount to be invested Net present value b. Would management be likely to look with favor on the proposal? because the net present value indicates that the retur on the proposal is than the minimum desired rate of return of 6%. Previous Next Check My Work Assignment Score: 37.5% Email Instructor o Save and Exit Submit Assignment for Grading

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