Net Present Value ApproachB7:H23 Time Period 0 1 2 3 4 5 Cash Flow Purchase Price $ (70,000) Labor Savings 20,000 20,000 20,000 20,000 20,000 Paint Savings 2,000 2,000 2,000 2,000 2,000 Maintenance -1000 (1,000) (1,000) (1,000) (1,000) (1,000) Residual Value 5,000 5,000 Total Cash Flow $ (70,000) 21,000 21,000 21,000 21,000 26,000 PV Factor 1 0.893 0.797 0.712 0.636 0.567 Total Cash...

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Accounting

NetPresent Value ApproachB7:H23
Time Period 0 1 2 3 4 5
Cash Flow
Purchase Price $      (70,000)
Labor Savings 20,000 20,000 20,000 20,000 20,000
Paint Savings 2,000 2,000 2,000 2,000 2,000
Maintenance -1000 (1,000) (1,000) (1,000) (1,000) (1,000)
Residual Value 5,000 5,000
Total Cash Flow $      (70,000) 21,000 21,000 21,000 21,000 26,000
PV Factor 1 0.893 0.797 0.712 0.636 0.567
Total Cash Flow $      (70,000) $        18,753 $      16,737 $        14,952 $       13,356 $        14,742
Required Rate of Return 12%=0.12
NPV $         8,540 NPV Using Excel (show formula): $         8,540
IRR IRR Using Excel (show formula): Can you pleasewrite out how to find IRR? Thank you so much

Answer & Explanation Solved by verified expert

4.4 Ratings (931 Votes)

Net Present Value ApproachB7H23 Time Period 0 1 2 3 4 5 Cash Flow Purchase Price 70000 Labor Savings 20000 20000 20000 20000 20000 Paint Savings 2000 2000 2000 2000 2000 Maintenance 1000 1000 1000 1000 1000 1000 Residual Value 5000 5000 Total Cash Flow 70000 21000 21000 21000 21000 26000 PV Factor 1 0893 0797 0712 0636 0567 Total Cash Flow 70000 18753 16737 14952 13356 14742 See Answer

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NetPresent Value ApproachB7:H23Time Period012345Cash FlowPurchase Price$ (70,000)Labor Savings20,00020,00020,00020,00020,000Paint Savings2,0002,0002,0002,0002,000Maintenance-1000(1,000)(1,000)(1,000)(1,000)(1,000)Residual Value5,0005,000Total Cash Flow$ (70,000)21,00021,00021,00021,00026,000PV Factor10.8930.7970.7120.6360.567Total Cash Flow$ (70,000)$ 18,753$ 16,737$ 14,952$ 13,356$ 14,742Required Rate of Return12%=0.12NPV$ 8,540NPV Using Excel (show formula):$ 8,540IRRIRR Using Excel (show formula): Can you pleasewrite out how to find IRR? Thank you so much

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NetPresent Value ApproachB7:H23
Time Period	0	1	2	3	4	5
Cash Flow
Purchase Price	$ (70,000)
Labor Savings		20,000	20,000	20,000	20,000	20,000
Paint Savings		2,000	2,000	2,000	2,000	2,000
Maintenance	-1000	(1,000)	(1,000)	(1,000)	(1,000)	(1,000)
Residual Value	5,000					5,000
Total Cash Flow	$ (70,000)	21,000	21,000	21,000	21,000	26,000
PV Factor	1	0.893	0.797	0.712	0.636	0.567
Total Cash Flow	$ (70,000)	$ 18,753	$ 16,737	$ 14,952	$ 13,356	$ 14,742

Required Rate of Return	12%=0.12

NPV	$ 8,540		NPV Using Excel (show formula):			$ 8,540
IRR			IRR Using Excel (show formula): Can you pleasewrite out how to find IRR? Thank you so much