A A A A Original cost of land Current land value Land value in 4 years Marketing study Year 1 sales Year 2 sales Year 3 sales Year 4 sales Sales price Fixed costs Variable costs Equipment costs Pretax salvage value Net working capital Tax rate Required return Year 1 depreciation Year 2 depreciation Year 3 depreciation Year 4 depreciation 2,100,000 2,300,000 2,400,000 125,000 3,600 4,300 5,200 3,900 750 415,000 15% 3,500,000 350,000 125,000 38% 13% 33.33% 44.45% 14.81% 7.41% Output area: Aftertax salvage value Sale price Taxes Total Year 0 Year 1 Year 2 Year 3 Year 4 Revenues Fixed costs Variable costs Depreciation EBT Taxes Net income OCF Capital spending Land Net working capital Total cash flow Discounting Factors DCF Captial Budgeting Indicators NPV IRR Payback Period Discounted Payback Period