Logan,Incis Considering the Purchase of a Warehouse Directly Across the Street

question 169

Multiple Choice

Logan,Inc.is considering the purchase of a warehouse directly across the street from its manufacturing plant.Logan currently warehouses its inventory in a public warehouse across town.Rent on the warehouse and delivering and picking up inventory cost Logan $48,000 per year.The building will cost Logan $450,000.Logan will depreciate the building for 20 years.At the end of 20 years,the building will have a $125,000 salvage value.Logan's required rate of return is 10%.The building's net present value is

• A) $41,347
• B) $22,772
• C) $427,228
• D) $960,000

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The difference in visual properties that makes an object distinguishable from other objects and the background.

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