11. Following figures relate to a new project for which a machine is to be acquired at a cost of `2,50,000 and initially `60,000 is to be invested as working capital:

Year 1 2 3 4 EBDIT (`) 80,000 90,000 1,45,000 1,20,000 Depreciation (`) 75,000 62,000 48,000 25,000 At the beginning of 2nd year, an amount of `10,000 is to be introduced as additional working capital.

On completion of the project i.e. at the end of the fourth year, it is expected that `40,000 will be realized from sale of scrap and working capital will be recovered in full.

Cost of capital is 12% and applicable tax rate is 30%.

Calculate NPV of the project and comment on its acceptability.