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Can I get some help with this...It is tab 5 - capi...

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Can I get some help with this...It is tab 5 - capital budgeting. I'm able to understand the rest but my prof, the initial cost of the new refrigeration unit is an outflow, so it would be shown as a negative number. After tax cash flow, annual electricity savings, and additional annual maintenance costs are all yearly, so you will need to use the PVIFA (annuity) table rather than the single sum table. After tax cash flow and annual electricity savings should be positive numbers while the additional annual maintenance costs would represent an outflow (negative). Net present value is the sum of all 5 numbers. With this information, I am lost. Please advise. Jessica

 

Paper#7945 | Written in 18-Jul-2015

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