A consultant has recommended that you modernize a production line. Costs include $862,000 in equipment, a $12,000 investment in net working capital at the time
A consultant has recommended that you modernize a production line. Costs include $862,000 in equipment, a $12,000 investment in net working capital at the time of installation, and $8,000 in delivery and installation costs. The consultant has billed the firm for $93,500 for her analysis of the project. If the project is undertaken, an employee training program costing $43,000 would be required. The old machinery has no book value but can be sold for $10,000. Your firm's marginal tax rate is 34%. What is the initial outlay associated with the project?
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Authors: Peter S Kaufman, Henry F Owsley
2nd Edition
1587983044, 978-1587983047
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