Find Proposal on basis of NPV techniques

[vickygupta]

Krishna Ltd. is considering an expansion of the 20
installed capacity of one of its plant at a cost of
Rs. 35,00,000. The firm has a minimum required
rate of return 12%. The following are the expected
cash inflows over next 6 year after which the plant will be scrapped away for nil value.
Cash PVF of Rs.
Year inflows (Rs.) 1/-at 12%
1 10,00,000/- 0.893
2 10,00,000/- 0.797
3 10,00,000/- 0.712
4 10,00,000/- 0.636
5 5,00,000/- 0.567
6 5,00,000/- 0.507
Consider the proposal on the basis of the NPV techniques.