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What it the net present value of the project

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Reference no: EM133036003

Question - Ignore income taxes in this problem - The management of Your Corporation is considering the purchase of a machine that would cost $460,000, would last for 7 years. Salvage value would be $45,000. The annual cash receipts would be $194,000 and the machine would reduce labor and other costs by $92,000 per year. The company requires a minimum pretax return of 12% on all investment projects. What it the net present value of the project?

a. $25,868

b. ($28,022)

c. $5,528

d. $9,140

Reference no: EM133036003

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