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AsadQ1 AsadQ1
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9 months ago

(Ignore income taxes in this problem.) Bradley Corporation's required rate of return is 14%. The company has an opportunity to be the exclusive distributor of a very popular consumer item. No new equipment would be needed, but the company would have to use one-fourth of the space in a warehouse it owns. The warehouse cost $200,000 new. The warehouse is currently half-empty and there are no other plans to use the empty space. In addition, the company would have to invest $100,000 in working capital to carry inventories and accounts receivable for the new product line. The company would have the distributorship for only 5 years. The distributorship would generate a $17,000 annual net cash inflow.

Required:
What is the net present value of the project?

Textbook 
Introduction to Managerial Accounting: Brewer Edition: 9e

Introduction to Managerial Accounting: Brewer Edition: 9e


Edition: 9th
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marlboromanmarlboroman
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9 months ago
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AsadQ1 Author
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9 months ago
Correct Slight Smile TY
Hellish Lover
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Yesterday
Good timing, thanks!
Turboturner
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2 hours ago
Helped a lot
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