Use the information for the question(s)below.
Epiphany Industries is considering a new capital budgeting project that will last for three years. Epiphany plans on using a cost of capital of 12% to evaluate this project. Based on extensive research, it has prepared the following incremental cash flow projects:

-The net present value (NPV)for Epiphany's Project is closest to:
A)$35 364
B)$39 000
C)$29 400
D)$14 348

Question

Use the information for the question(s)below.
Epiphany Industries is considering a new capital budgeting project that will last for three years. Epiphany plans on using a cost of capital of 12% to evaluate this project. Based on extensive research, it has prepared the following incremental cash flow projects:
 
-The net present value (NPV)for Epiphany's Project is closest to:
A)$35 364 
B)$39 000 
C)$29 400 
D)$14 348

Quizplus · Accepted Answer

The net present value (NPV) calculation involves discounting future cash flows to their present value and subtracting the initial investment. Without specific cash flow details, discount rates, or investment amounts provided in the question, it's impossible to accurately calculate or validate the NPV. However, based on the choices given, if A is identified as the correct answer, it suggests that the NPV calculation for Epiphany's Project, using the appropriate formula and inputs, results in an NPV closest to $35,364. This would typically mean that the present value of the project's cash inflows minus the present value of cash outflows (including the initial investment) equals approximately $35,364, indicating a positive net benefit from the project.

Use the Information for the Question(s)below