6.3 Calculating Project NPV Down Under Boomerang, Inc., is considering a new three-year expansion project that requires an initial fixed asset investment of $1.65 million. The fixed asset will be depreciated straight-line to zero over its three-year tax life, after which it will be worthless. The project is estimated to generate $1.24 million in annual sales, with costs of $485,000. The tax rate is 35 percent and the required return is 12 percent. What is the project's NPV? Year Cash Flow from Assets $ $ $ 1 2 Initial Purchase Annual Sales Cost of Goods Sold Discount Rate Tax Rate Project Life 1,650,000.00 1,240,000.00 485,000.00 12.00% 35.00% 3 NPV Depreciation Net Income Annual Operating Cash Flow