SOLUTION TO ACCOUNTING PROBLEM

Solution to Accounting Problem

Solution to Accounting Problem

Case # 1

Full integration is most recent PC or Mac computers. Direct integration to online music services for immediate product distribution. 3 year manufacturer's warranty 4 year extended warranty option. No charge installation or training. Initial Cost: $ 3,280,000. Financing Terms: 7 years at an annual interest rate of 6 % Expected annual net cash flows from purchase: $ 630,000 Audio Excellence Model 12-K Manufacturer: Audio Excellence, Inc. Features: 20 channel recording device and accessories (cables, microphones, wireless units, etc.)

NPV and Payback Period

Payback Period

Discounted Factor

6 %

Year

0

1

2

3

4

5

6

7

Net Cash flow

(630,000.00)

...