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Present value of estimated annual savings

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Reference no: EM132134752

1. The following data are given for the Allright Corporation:

Initial cost of proposed equipment                                                        $75,000

Estimated useful life                                                                                     7 years

Estimated annual savings in cash operating expenses                   $18,000

Predicted residual value at the end of useful life                             $3,000

Cost of Capital  12%

Compute the: (a) payback period; (b) present value of estimated annual savings; (c) present value of estimated residual value; (c) present value of estimated cash inflows; € net present value (NPV); and (f) internal rate of return (IRR)

Reference no: EM132134752

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