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Question: Tempura, Inc., is considering two projects. Project A requires an investment of $70,000. Estimated annual receipts for 20 years are $22,000; estimated annual costs are $12,500. An alternative project, B, requires an investment of $65,000, has annual receipts for 20 years of $26,000, and has annual costs of $18,000. Assume both projects have a zero salvage value and that MARR is 14.5 %/year.

What is the present worth of each project? Project A? Project B?

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M92571899

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