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a capital project with a 5 year life and cost of $48000 generates additional revenue as...

a capital project with a 5 year life and cost of $48000 generates additional revenue as follows: $5000 in year 1 $12000 in year2 $15000 in year 3 $18000 in year 4 $20000 in year 5 based on a discount rate is 4%, what is the present value of the project?

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Answer #1
Ans. Year Cash inflows PV @4% PV of cash inflow
1 5000 0.961538462 4807.692308
2 12000 0.924556213 11094.67456
3 15000 0.888996359 13334.94538
4 18000 0.854804191 15386.47544
5 20000 0.821927107 16438.54214
Total of PV of cash inflows 61062.32982
Net Present Value = Present value of cash inflow - Investment
61062.32982 - 48000
13062.32982
or   13062.33   (rounded)
*Calculations of PV @4%:
Year
1 1 / (1 + 0.04)^1 0.961538462
2 1 / (1 + 0.04)^2 0.924556213
3 1 / (1 + 0.04)^3 0.888996359
4 1 / (1 + 0.04)^4 0.854804191
5 1 / (1 + 0.04)^5 0.821927107
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