Top Posters
Since Sunday
s
3
v
3
p
3
m
2
s
2
d
2
N
2
d
2
e
2
s
2
s
2
e
2
Home Q & A Board Other Fields Homework Help Business Accounting
New Topic  
cassandra_dan cassandra_dan
wrote...
Go to Answer
Posts: 139
Rep: 0 0
A year ago

Lambert Manufacturing has $120,000 to invest in either Project A or Project B. The following data are available on these projects (Ignore income taxes.):

Project AProject B
Cost of equipment needed now$ 120,000$ 70,000
Working capital investment needed now$ 0$ 50,000
Annual net operating cash inflows$ 50,000$ 45,000
Salvage value of equipment in 6 years$ 15,000$ 0

Click here to view Exhibit 12B-1 and Exhibit 12B-2, to determine the appropriate discount factor(s) using the tables provided.

Both projects have a useful life of 6 years. At the end of 6 years, the working capital investment will be released for use elsewhere. Lambert's discount rate is 14%.

The net present value of Project A is closest to:



▸ $82,241

▸ $67,610

▸ $74,450

▸ $81,290
Textbook 
Introduction to Managerial Accounting: Brewer Edition: 9e

Introduction to Managerial Accounting: Brewer Edition: 9e


Edition: 9th
Authors:
Read 74 times
1 Reply
Replies
Answer verified by a subject expert
wardasidwardasid
wrote...
#1
Posts: 149
Rep: 0 0
A year ago
Sign in or Sign up in seconds to unlock everything for free
More solutions for this book are available here
1

Related Topics

cassandra_dan Author
wrote...

A year ago
This site is awesome
novae
wrote...

Yesterday
Smart ... Thanks!
spaghetti
wrote...

2 hours ago
Thanks
New Topic      
Quick Reply
Explore
Post your homework questions and get free online help from our incredible volunteers
  1269 People Browsing
Start New Topic Take the Tour CoursesNew Study Tools Topics Trending Browse by Textbook
Live Chat
Related Images
  
 1630
  
 123
  
 1119
Your Opinion
Who will win the 2024 president election?
Votes: 119
Closes: November 4
Previous poll results: Which industry do you think artificial intelligence (AI) will impact the most?