Stomberg Corporation has provided the following data concerning an investment project that it is considering:
Initial investment $ 550,000
Annual cash flow $ 180,000 per year
Salvage value at the end of the project 14,000
Click here to view Exhibit 13B-1 and Exhibit 13B-2, to determine the appropriate discount factor(s) using the tables provided.
The life of the project is 4 years. The company’s discount rate is 10%. The net present value of the project is closest to:
$20,420
$579,982
$184,000
$29,982
