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What is the net present value of all relevant cash outflows

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Question 1: Wubba Bubba Inc. produced bass woofers. Management estimates that if it invests $60,000 in new equipment, it can save $13,000 each year in annual cash operating costs. To transport and set up the equipment will require an additional $5,000. The equipment has an expected useful life of 5 years, wtih an annuity rate of 3.791. The old equipment is worth $9,750 on disposal. The company uses a net present value method and requires a 10% rate of return. What is the net present value of all relevant cash outflows and inflows for the useful life of the equipment?

Reference no: EM132784584

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