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Home Q & A Board Other Fields Homework Help Business Accounting
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bernie2981 bernie2981
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8 years ago Edited: 8 years ago, duddy
(Present value tables are needed.) The Janus Vending Machine Company is looking to expand its business by adding a new line of vending machines. The management team is considering expanding into either soda machines or snack machines. Following is the relevant financial data relating to the decision:

   Soda
Machines   Snack Machines
Investment   $75,000   $50,000
Useful life (years)   5   10
Estimated annual net cash inflows for useful life   $30,000   $18,000
Residual value   $30,000   $10,000
Depreciation method   straight-line   straight-line
Required rate of return   8%   12%

What is the present value of all future cash inflows from the snack machines and residual value?
A) $54,920
B) $104,920
C) $101,700
D) $75,094
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Managerial Accounting

Managerial Accounting


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nucleinuclei
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bernie2981 Author
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8 years ago
Answers my question perfectly.
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