Quall Company is considering buying a food truck that will yield net cash inflows of $10,200 per year for seven years. The truck costs $47,000 and has an estimated $6,800 salvage value at the end of the seventh year (PV of $1. EV of $1. PVA of $1, and EVA of $1 Note: Use appropriate factor(s) from the tables provided. Enter negative net present values, if any, as negative values. Round your present value factor to 4 decimals. What is the net present value of this investment assuming a required 12% return? Years 1-7 Year 7 salvage Net Cash Flows 3 $ 10.200 x 6.800x PV Factor 04030 . Present Value of Net Cash Flows $ 4,120 0

Managerial Accounting
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Chapter12: Capital Investment Analysis
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QS 11-16 (Algo) Net present value of annuity and salvage value LO P3
Quall Company is considering buying a food truck that will yield net cash inflows of $10.200 per year for seven years. The truck costs
$47,000 and has an estimated $6,800 salvage value at the end of the seventh year (PV of $1. EV of $1. PVA of $1. and FVA of $1)
Note: Use appropriate factor(s) from the tables provided. Enter negative net present values, If any, as negative values. Round your
present value factor to 4 decimals.
What is the net present value of this investment assuming a required 12% return?
Years 1-7
Year 7 salvage
Totals
Initial investment
Net present value
Net Cash Flows
S
S
10.200 x
6,800x
PV Factor
0.4030-
..
Present Value of
Net Cash Flows
$
4,120
0
Transcribed Image Text:QS 11-16 (Algo) Net present value of annuity and salvage value LO P3 Quall Company is considering buying a food truck that will yield net cash inflows of $10.200 per year for seven years. The truck costs $47,000 and has an estimated $6,800 salvage value at the end of the seventh year (PV of $1. EV of $1. PVA of $1. and FVA of $1) Note: Use appropriate factor(s) from the tables provided. Enter negative net present values, If any, as negative values. Round your present value factor to 4 decimals. What is the net present value of this investment assuming a required 12% return? Years 1-7 Year 7 salvage Totals Initial investment Net present value Net Cash Flows S S 10.200 x 6,800x PV Factor 0.4030- .. Present Value of Net Cash Flows $ 4,120 0
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