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(Ignore income taxes in this problem.) Boston Company is contemplating the purchase of a new machine on which the following information has been...

(Ignore income taxes in this problem.) Boston Company is contemplating the purchase of a new machine on which the following information has been gathered:

Cost of the machine $38,900
Annual cash inflows expected $10,000
Salvage value $ 5,000
Life of the machine 6 years
The company's discount rate is 16%, and the machine will be depreciated using the straight-line method. Given these data, the machine has a net present value of:

-$26,100.
-$23,900.
$0.
+$26,100.

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Dear Student Please find... View the full answer

Accounting -8093686.xls

Year Particulars
0 Cash outflow
1 Cash inflow
2 Cash inflow
3 Cash inflow
4 Cash inflow
5 Cash inflow
6 Cash inflow (10000+5000)
Total P.V
Answer C Amount $
-38,900
10,000
10,000
10,000
10,000...

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