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QS B-6 Present value of an annuity LO P3 Beene Distributing is considering a project that...

QS B-6 Present value of an annuity LO P3

Beene Distributing is considering a project that will return $230,000 annually at the end of each year for the next ten years. If Beene demands an annual return of 9% and pays for the project immediately, how much is it willing to pay for the project? (PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided. Round PVA factor to 4 decimals.)

Periodic Cash Flow x p (PV of an Ordinary Annuity) = Present Value
x =


  

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Answer #1
Answer

Periodic Cash Flow

 × p (PV of an Ordinary Annuity) = Present Value
$                                          230,000 × 6.4177 = $          1,476,061
230000*6.4177
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