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Homework answers / question archive / Dawntreader Landscaping is considering purchasing $175,000 of new lawn equipment and they anticipate the additional equipment will result in cash flows as below

Dawntreader Landscaping is considering purchasing $175,000 of new lawn equipment and they anticipate the additional equipment will result in cash flows as below

Finance

Dawntreader Landscaping is considering purchasing $175,000 of new lawn equipment and they anticipate the additional equipment will result in cash flows as below. Their weighted average cost of capital is 8.75%.  

Year Cash flow
1 36,000
2 41,000
3 45,000
4 53,000
5 58,000

The profitability index for the project is:

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