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Question - Carter Company is trying to determine the value of an investment of $10,000 to switch from a manual to an automated cash disbursement system. It makes 5000 disbursements per year. Each check costs $0.75 on a manual basis and would drop to $0.07 if the switch is made. The company has an opportunity cost of 6%. Using this information, what would be the investment's NPV?

a. $45,000

b. $52,250

c. $58,000

d. $65,000

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M93107146

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