a) Maju Construction (MCo) Sdn. Bhd. is bidding on a contract to build four tiny camping house

(TCH) a year for the next three years for Sintokian campsite. Each TCH will be sold at the

price of P. The project requires the purchase of RM132,000 of equipment which will be

depreciated using simplied straight-line depreciation to a zero book value over the three

years. The equipment can be sold at the end of the project for RM80,000. MCo will

also need RM32,000 in net working capital over the life of the project. The xed costs will

be RM36,000 a year and the variable costs will be RM1?6,000 per TCH. MCo required rate

of return is 14% for this project and the tax rate is 24%. Based on the information given:

Calculate the initial outlay of the project. i) Calculate the initial outlay of the project. (1 mark)

ii) Calculate the annual cash ows of the project. (I mark)

iii) Calculate the terminal cash ows of the project (2 marks)