Carr Company is considering two capital investment proposals. Estimates regarding each project are provided below
Project Soup
Initial investment $400,000
Annual net income. $30,000
Net annual cash inflow $110,000
Estimated useful life 5 years
Salvage Value. 0
Project Nuts
Initial investment. $60,000
Annual net income $46,009
Net annual cash inflow $146,000
Estimated Useful life. 6 years
Salvage Value
The company requires a 10% return on all investments.
Present Value of an Annuity of 1
Period 5.
9%. 3.890
10% 3.791
11%. 3.696
12%. 3.605
Period 6
9%. 4.486
10%. 4.355
11%. 4.231
12%. 4.111
The net present value for project nuts is
