Managerial Accounting: BE12-6 Rogler Company is performing a post-audit of a project

Managerial Accounting

BE12-6
Rogler Company is performing a post-audit of a project completed one year ago. The initial estimates were that the project would cost $250,000, would have a useful life of 9 years, zero salvage value, and would result in net annual cash flows of $45,000 per year. Now that the investment has been in operation for 1 year, revised figures indicate that it actually cost $260,000, will have a useful life of 11 years, and will produce net annual cash flows of $38,000 per year.

Evaluate the success of the project. Assume a discount rate of 10%.
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