Question

A company is considering a project with the following expected cash flows: Year 0: -$685,000 Year 1: $305,000 Year 2: $305,000 Year 3: $305,000 The company requires a 15% return on investment. Compute the NPV for the project. (Do not round intermediate calculations. Round the final answer to 2 decimal places. Omit any commas and the $ sign in your response. For example, an answer of $1,000.50 should be entered as 1000.50.)

Answer 1

Year	Cash Flow	PV Factor	PV Of Cash Flow
a	b	c=1/1.15^a	d=b*c
0	$ -685,000	1	$       -685,000.00
1	$   305,000	0.869565	$        265,217.39
2	$   305,000	0.756144	$        230,623.82
3	$   305,000	0.657516	$        200,542.45
	NPV		$           11,383.66