18. ElectriKal Corp. is evaluating a project that will produce $100,000 in sales a year and $75,000 in costs a year, for the next 5 years. The project will require a capital investment of $150,000 that will be depreciated straight-line to a zero book value over the 5-year life of the project. The applicable tax rate is 20 percent. Assume the firm is overall profitable. Net working capital is zero. What is year I's cash flow (i.e., after adjustments)? (a) -$4,000

(b) -$5,000

(c) $50.000

(d) $25,000

(e) $26,000

19. A project is expected to generate after tax net income (i.e., NI) of $20,000 a year for three years. To calculate the project's NPV you are provided with the following information:

The initial cost of the fixed assets is $60,000, depreciated over three years (straight-line depreciation).

Net working capital levels for years 0, 1, 2, and 3 are 10,000, 12,000, 15,000 and 0, respectively.

What is the project's net present value if the required rate of return is 15 percent?

(a) $21,329.00

(b) $31,329.00

(c) $27,184.19

(d) -$ 18,480.32

(e) -$ 14,335.50