Michaels, Inc., purchased a machine for $75,000. The machine has a useful life of five years and no salvage value. Straight-line

Question

3 years ago

9

Michaels, Inc., purchased a machine for $75,000. The machine has a useful life of five years and no salvage value. Straight-line

depreciation is to be used. The machine is expected to generate cash flow from operations, net of income taxes, of $25,000 in each of the five years. Michaels' expected rate of return is 10%. Information on present value factors is as follows:
Period Present Value of $1 at 10% Present value of ordinary annuity of $1 at 10%
1 0.90909 0.90909
2 0.82645 1.73554
3 0.75132 2.48685
4 0.68301 3.16986
5 0.62092 3.79079

What would be the net present value?

Mathematics

2 answers:

bogdanovich [222] · Answer 1 · 2022-07-06T01:17:14+03:00

bogdanovich [222]3 years ago

6 0

The net will be 0.0909

lys-0071 [83] · Answer 2 · 2022-07-06T02:43:22+03:00

lys-0071 [83]3 years ago

6 0

Answer:

0.0909

Step-by-step explanation: