2: The free cash flow for the first year of Epiphanys project is closes to:

3: The free cash flow for the last year of Epiphany's project is closest to:

Epiphany Industries is considering a new capital budgeting project that will last for three years. Epiphany plans on using a cost of capital of 12% to evaluate this project. Based on extensive research, it has prepared the following incremental cash flow projects: Year 1 Sales (Revenues) 100.000 - Cost of Goods Sold (50% of Sales) 50.000 - Capital Cost Allowance 13,500 = EBIT 36,500 Taxes (355) 12.775 unlevered net income 23,725 Capital Cost Allowance 13.500 changes to working capital -5000 * capital expenditures -90.000 The net present value (NPV) for lipiphanys Project is closest to 2 100.000 100.000 50.000 50,000 22.950 16,065 27050 33,935 9468 11877 17.382 22,058 22,950 16,065 -5000 10 000 + $0 -$4825 $1351 $4825 $28,772