Determining the present value of the investment, Accounting Basics

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Determining the present value of the investment

A business is considering the investment in a new machine that will cost $320,000 with no salvage value. The machine is expected to reduce labor costs by $70,000 per year and material scrap by $20,000 per year. The machine is expected to have a 5-year life. What is the present value of this investment, assuming a 12% interest rate?

A. $4,450

B. $130,000

C. $(64,850)

D. $(67,650)

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Accounting Basics: Determining the present value of the investment

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Accounting Basics: Determining the present value of the investment

Reference No:- TGS090338

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Recent Questions Asked Accounting Basics

Q : Non-controlling interest in net income measured by gaap

Q : Subsidiary land and inventory

Q : Acquisition cost over book value

Q : Find the net present value of the investment

Q : Determining the present value of the investment

Q : Events using the fair value method

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Request for Solution File

Ask an Expert for Answer!!

Accounting Basics: Determining the present value of the investment

Reference No:- TGS090338

Recent Questions Asked Accounting Basics

Q : Non-controlling interest in net income measured by gaap

Q : Subsidiary land and inventory

Q : Acquisition cost over book value

Q : Find the net present value of the investment

Q : Determining the present value of the investment

Q : Events using the fair value method

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