(Answered) Question logan inc is considering the purchase of a

Accounting

Question: Logan, Inc. is considering the purchase of a warehouse directly across the street from its manufacturing plant. Logan currently warehouses its inventory in a public warehouse across town. Rent on the warehouse and delivering and picking up inventory cost Logan $48,000 per year. the building will cost Logan $400,000. Logan will depreciate the building for 20 years. At the end of 20 years, the building will have a $125,000 salvage value. Braxton's required rate of return is 10%. the building's net present value is

a. $41, 347

b. $27, 228

c. $427, 228

d. $960,000

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