A river shipowner, Navilia, operates a barge with three operating years remaining. After all necessary outflows and the final net disposal proceeds, the expected cash surpluses amount to 105,000 at the end of the first year, 330,750 at the end of the second, when an exceptional charter contract is planned, and 231,525 at the end of the last. Navilia discounts these amounts at the given rate of 5 %. Determine the value in use of the barge.
- Cash surplus, end of year 1
- 105,000
- Cash surplus, end of year 2
- 330,750
- Cash surplus, end of year 3
- 231,525
- Discount rate (given)
- 5 %