Question
a corporation has the following jumbled information about an investment: a. revenues in each of years 1-3: $31,000 b. year 0 initial investment : 51,000
a corporation has the following jumbled information about an investment: a. revenues in each of years 1-3: $31,000 b. year 0 initial investment : 51,000 c. inventory level : year1= 15,500 year 2= 17,100 and year 3=10,500 d. production costs : 10,300 in aech year 1-3 e. salvage value : 13,100 in year 4 f. depreciation : 100%immediate bonus depreciation g. tax rate : 21% h. customers pay with a 6 month lag. Draw up a set of cashflow forecasts if the cost of capital is 10%, what is the projects NPV? Assume that if the project generates losses, those losses can be used to offset profits elsewhere in the business. Whats the NPV do not round.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started