5. Incremental costs - Initial and terminal cash flow Newcastle Coal Company is considering a project that requires an investment in new equipment of $3,400,000, with an additional $170,000 in shipping and installation costs. Newcastle estimates that its accounts receivable and inventories need to increase by $680,000 to support the new project, some of which is financed by a $272,000 increase in spontaneous liabilities (accounts payable and accruals). The total cost of Newcastle's new equipment is and consists of the price of the new equipment plus the In contrast, Newcastle's initial investment outlay is Suppose Newcastle's new equipment is expected to sell for $400,000 at the end of its four-year useful life, and at the same time, the firm expects to recover all of its net operating working capital investment. The company chose to use straight-line depreciation, and the new equipment was fully depreciated by the end of its useful life. If the firm's tax rate is 40%, what is the project's total termination cash flow? $568,000 5648,000 O $240,000 $400,000 Newcastle Coal Company is considering a project that requires an investment in new equipment of $3,400,000, with an additional $170,000 in shipping and installation costs. Newcastle estimates that its accounts receivable and Inventories need to increase by $680,000 to support the new project, some of which is financed by a $272,000 increase in spontaneous liabilities (accounts payable and accruals). The total cost of Newcastle's new equipment is and consists of the price of the new equipment plus the $3,400,000 In contrast, Newcastle's initial investment outla $680,000 $3,570,000 Suppose Newcastle's new equipment is expecte 00,000 at the end of its four-year useful life, and at the same time, the firm expects to recover all of its net operating working capital investment. The company chose to use straight-line depreciation, and the new equipment was fully depreciated by the end of its useful life. If the firm's tax rate is 40%, what is the project's total termination cash flow? @ $568,000 5648,000 5240.000 5400,000 Grade It Now Save & Continue S. Incremental costs - Initial and terminal cash flow Newcastle Coal Company is considering a soject that requires an investment in new equipment of $3,400,000, with an additional $170,000 in shipping and installation costs. Newcastle estimates that its accounts receivable and inventories need to increase by $680,000 to support the new project, some of which is financed by a $272,000 increase in spontaneous liabilities (accounts payable and accruals). The total cost of Newcastle's new equipment is and consists of the price of the new equipment plus the asset's salvage value project's accounts payable sell for $400,000 at the end of its four-year useful life, and at the same time, the firm expects to asset's installation, shipping, and delivery costs stment. The company chose to use straight-line depreciation, and the new equipment was fully depreciated by the end of its useful life. If the firm's tax rate is 40%, what is the project's total termination cash flow? O $568,000 O $648,000 $240,000 O $400,000 Crno bela 5. Incremental costs - Initial and terminal cash flow Newcastle Coal Company is considering a project that requires an investment in new equipment of $3,400,000, with an additional $170,000 in shipping and installation costs. Newcastle estimates that its accounts receivable and inventories need to increase by $680,000 to support the new project, some of which is financed by a $272,000 increase in spontaneous liabilities (accounts payable and accruals). The total cost of Newcastle's new equipment is and consists of the price of the new equipment plus the In contrast, Newcastle's initial investment outlay is Suppose Newcastle's new equipment is expected to $3,706,000 poo at the end of its four-year useful life, and at the same time, the firm expects to recover all of its net operating working capital invee $3,808,000 mpany chose to use straight-line depreciation, and the new equipment was fully depreciated by the end of its useful life. If the firm %, what is the project's total termination cash flow? $3,978,000 $568,000 $648,000 $240,000 $400,000