1-1 Summer Tyme, Inc., is considering a new 3-year expansion project that requires an initial fixed asset investment of $3.996 million. The fixed asset will be depreciated straight-line to zero over its 3-year tax life, after which time it will be worthless. The project is estimated to generate $3,552,000 in annual sales, with costs of $1,420,800. Required: If the tax rate is 32 percent, what is the OCF for this project?

Geary Machine Shop is considering a four-year project to improve its production efficiency. Buying a new machine press for $595,200 is estimated to result in $198,400 in annual pretax cost savings. The press falls in the MACRS five-year class (MACRS Table), and it will have a salvage value at the end of the project of $86,800. The press also requires an initial investment in spare parts inventory of $24,800, along with an additional $3,720 in inventory for each succeeding year of the project.f the shop's tax rate is 35 percent and its discount rate is 17 percent, what is the NPV for this project? (Do not round your intermediate calculations.)