Tricorp Company is considering an investment that is expected to return $320,000 after four years. If Tricorp demands a 15% return, what is the most that it will be willing to pay for this investment? 15%, 4 years annually Factor Present value of a $1 0.572 Future value of $11.749 Present value of an annuity 2.855 Future value of an annuity 4.993 a. $320,000 b. $177,696 c. $183,040 d. $45,216 e. $278,272

Principles of Accounting Volume 2
19th Edition
ISBN:9781947172609
Author:OpenStax
Publisher:OpenStax
Chapter11: Capital Budgeting Decisions
Section: Chapter Questions
Problem 19EA: Redbird Company is considering a project with an initial investment of $265,000 in new equipment...
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Tricorp Company is considering an
investment that is expected to
return $320,000 after four years. If
Tricorp demands a 15% return, what
is the most that it will be willing to
pay for this investment?
15%, 4 years annually Factor
Present value of a $1 0.572
Future value of $11.749
Present value of an annuity 2.855
Future value of an annuity 4.993
a. $320,000
b. $177,696
c. $183,040
d. $45,216
e. $278,272
Transcribed Image Text:Tricorp Company is considering an investment that is expected to return $320,000 after four years. If Tricorp demands a 15% return, what is the most that it will be willing to pay for this investment? 15%, 4 years annually Factor Present value of a $1 0.572 Future value of $11.749 Present value of an annuity 2.855 Future value of an annuity 4.993 a. $320,000 b. $177,696 c. $183,040 d. $45,216 e. $278,272
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