The Cambro Foundation, a nonprofit organization, is planning to invest $214,085
ID: 2494097 • Letter: T
Question
The Cambro Foundation, a nonprofit organization, is planning to invest $214,085 in a project that will last for three years. The project will produce net cash inflows as follows:
Click here to view Exhibit 13B-1 and Exhibit 13B-2, to determine the appropriate discount factor(s) using table.
Required:
Assuming that the project will yield exactly a 7% rate of return, what is the expected net cash inflow for Year 3? (Round discount factor(s) to 3 decimal places.)
The Cambro Foundation, a nonprofit organization, is planning to invest $214,085 in a project that will last for three years. The project will produce net cash inflows as follows:
Explanation / Answer
In nonprofit organisation they work on no profit and loss
So third year Present value= $81594.8
So Cash Inflow=81594.8/.816=$99956.88
USD$ Year Cah Flow Discount @7% Discounted Amount 0 214085 1 -214085 1 67000 0.9346 62618.20 2 80000 0.8734 69872.00 3 ? 0.8163 0.00 -81594.80