Iignore income taxes in this problem.) The Sawyer Corporeson hes $75,000 to Inve

Question

Iignore income taxes in this problem.) The Sawyer Corporeson hes $75,000 to Invest and is considering two different projects, X and Y. The following data are avalilable on the projects Click here to view Exhibr 88-1 and Eshibs 88.2 to determine the appropnane discount factontg using tables Cost of equipment needed now Working copitsl requiremet Annuei cosh opereting infiow Selvage velue in 5 yeers 75000 75,000 $ 19,00014,000 S9000 Both projects wal heve a useful life of S years at the end of 5 years, the workeng captal willbe releesed for use elcewhere Senyer's discourt rate is 10 The net present velue of project Y is closest to. O $9509 O $24649 O $8.009 O $8009

Explanation / Answer

Ans: Option B

Solution: Net Present Value of project y = 14000 x 3.791 + 75000 x 0.621 -75000

                                                                        = $ 24649

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