Use the Following Table for Questions 109-111 $\text { Present Value of an Annuity of } 1$

question 139

Multiple Choice

Use the following table for questions 109-111. $\text { Present Value of an Annuity of } 1$
$\begin{array}{rrrr}\text { Periods } & 8 \% & 9 \% & 10\%\\1 & .926 & .917 & .909 \\2 & 1.783 & 1.759 & 1.736 \\3 & 2.577 & 2.531 & 2.487\end{array}$
-A company has a minimum required rate of return of 9%. It is considering investing in a project that costs $210,000 and is expected to generate cash inflows of $84,000 at the end of each year for three years. The net present value of this project is

• A) $212,604.
• B) $42,000.
• C) $21,261.
• D) $2,604.

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Definitions:

Work in Process

A stage in the production process where goods are partially completed and will require further work before they are ready for sale.

Costs Transferred

The expenses that are moved from one department or project to another within the same company.

Underapplied Overhead

A situation in accounting where the allocated overhead for a period is less than the actual overhead incurred.

Manufacturing Overhead

All indirect costs associated with the manufacturing process, including salaries of non-direct labor, maintenance, and factory supplies.