Alli's Medical is considering some new equipment, for which data is shown below. The equipment has a 3-year tax life and will be fully depreciated by the straight-line method over 3 years, but it will have a positive pre-tax salvage value at the end of Year 3, when the project will be closed down. Also, additional net operating working capital will be required, but it will be recovered at the end of the project's life. Revenues and other operating costs are expected to be constant over the project's 3 year life. What is the project's NPV?

WACC 10.0%

Net Investment in Fixed Assets (Depreciable Basis) $70,000

Required net working operating working capital $10,000

Straight-line depreciation rate 33.3333%

Annual sales revenues $75,000

Annual operating costs (excluding depreciation) $30,000

Expected pre-tax salvage value $5,000

Tax rate 35.0%