A hospital is considering the possibility of two new purchases: newX-ray equipment and new biopsy equipment. Each project wouldrequire an investment of P750,000. The expected life for each is 5years with no expected salvage value. The net cash inflowsassociated with the two independent projects are as follows:X-ray EquipmentYearBiopsy Equipment1P 75,00023475,000525,000600,000675,000What is the net present value of each project assuming a requiredrate of return of 12%?5c. X-ray: P54,312 Biopsy: P512,389, Not SelectedCorrect answer:P375,000b. X-ray: P55,821 Biopsy: P514,766a. X-ray: P56,378 Biopsy: P499,818150,000300,000150,00075,000

Answer to Question: b. X-ray P55,821 Bioposy P514,766 Meaning: The word "Net" in the tern Net…

A hospital is considering the possibility of two new purchases: new X-ray equipment and new biopsy equipment. Each project would require an investment of P750,000. The expected life for each is 5 years with no expected salvage value. The net cash inflows associated with the two independent projects are as follows: Year X-ray Equipment Biopsy Equipment 1 P 75,000 2 3 4 5 150,000 75,000 300,000 525,000 150,000 600,000 75,000 675,000 What is the net present value of each project assuming a required rate of return of 12%? c. X-ray: P54,312 Biopsy: P512,389 Not Selected Correct answer: b. X-ray: P55,821 a. X-ray: P56.378 P375,000 Biopsy: P514,766 Biopsy: P499.818

A hospital is considering the possibility of two new purchases: new X-ray equipment and new biopsy equipment. Each project would require an investment of P750,000. The expected life for each is 5 years with no expected salvage value. The net cash inflows associated with the two independent projects are as follows: Year X-ray Equipment Biopsy Equipment 1 P 75,000 2 3 4 5 150,000 75,000 300,000 525,000 150,000 600,000 75,000 675,000 What is the net present value of each project assuming a required rate of return of 12%? c. X-ray: P54,312 Biopsy: P512,389 Not Selected Correct answer: b. X-ray: P55,821 a. X-ray: P56.378 P375,000 Biopsy: P514,766 Biopsy: P499.818

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter19: Capital Investment

Section: Chapter Questions

Problem 2CE

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