Edelman engineering is considering including two pieces of


Edelman Engineering is considering including two pieces of equipment, a truck and an overhead pulley system, in this year's capital budget. The projects are independent. The cash outlay for the truck is $17,600, and that for the pulley system is $20,000. The firm's cost of capital is 12.50%. After-tax cash flows, including depreciation, are as follows:

Year Truck Pulley

1    $5,450    $9,100

2   $5,450   $9,100

3    $5,450    $9,100

4   $5,450   $9,100

5    $5,450   $9,100

Calculate NPV of truck project and Pully project.

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Financial Management: Edelman engineering is considering including two pieces of
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