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What is the net present value

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Reference no: EM132013513

Problem - Basic NPV with Salvage Value

Redwood Orchards Organics purchased a new composter at a cost of $88,000. Annual operating cash inflows are expected to be $35,000 each year for four years. At the end of the composter's useful life, the salvage value of the tractor is expected to be $4,000.

Required: What is the net present value if the cost of capital is 12 percent? Use the time value of money charts for your calculations. (Ignore income taxes.)

Reference no: EM132013513

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