Reference no: EM133009897

The Flounder Company is planning to purchase $ 468,000 of equipment with an estimated 7-year life and no estimated salvage value. The company has projected the following annual cash flows for the investment:

Year         Projected Cash Flows
1               $ 211,000
2                 130,000
3                115,000
4                    55,500
5                 63,200
6                    43,400
7                   49,200
Total                $ 667,300

Problem 1: Calculate the net present value of the proposed equipment purchase. Flounder uses a 11% discount rate.