Calculating NPV-NPV Projected) X 10%

Accounting
Tutor: None Selected Time limit: 1 Day

I am supposed to assume that the actual cash inflows turn out to be $91,000 per year versus the real value calculated which was 100,000.  Determine the amount of Mr. Holt's bonus if the original computation of net present value were based on $90,000 versus $70,000.  This is the question I need help with.

May 25th, 2015

You'll need a present-value table in order to calculate these values, but you can find those online and in textbooks:

Cash inflows (b) $91,000 / $90,000 / $70,000
Present value (a x b) 344,961.62 / 341,170.83 / 265,355.09
Cost of investment -250,000.00 / -250,000.00 / -250,000.00
Net present value 94,961.92 / 91,170.83 / 15,355.09 

Net Projected Value 94,961.92 / 94,961.92

3,791.09*10% 79,606.83*10%

Bonus 379.11 7,960.68

May 25th, 2015

Did you know? You can earn $20 for every friend you invite to Studypool!
Click here to
Refer a Friend
...
May 25th, 2015
...
May 25th, 2015
Dec 4th, 2016
check_circle
Mark as Final Answer
check_circle
Unmark as Final Answer
check_circle
Final Answer

Secure Information

Content will be erased after question is completed.

check_circle
Final Answer