Humphrey, Inc. is considering purchasing equipment costing $30,000 with a 6-year useful life. The equipment will provide cost savings of $7,300 and will be depreciated straight-line over its useful life with no salvage value. Humphrey, Inc. requires a 10% rate of return.
Present Value of an Annuity of 1
Periods 8%
9%
10%
11%
12%
15%
6 4.623 4.486 4.355 4.231 4.111 3.784
What is the approximate net present value of this investment?