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Bauer Industries is an automobile manufacturer. Management is currently evaluating a proposal to build a plant that will manufacture lightweight trucks. Bauer plans to use

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Bauer Industries is an automobile manufacturer. Management is currently evaluating a proposal to build a plant that will manufacture lightweight trucks. Bauer plans to use a cost of capital of 1 1 6% to evaluate this pro ect Based on extensive research, it has prepared the incremental free cash projections shown below n millons of dol an Year Revenues Manufacturing Expenses (other than depreciation) Marketing Expenses Depreciation EBIT Taxes at 35% Unlevered Net Income Depreciation 1-9 10 97.4 32.5 10.8 -14.9 39.2 -13.7 25.5 14.9 5.8 7.4 32.5 - 10.8 - 14.9 39.2 - 13.7 25.5 14.9 -5.8 ions to Net Workina Caoital

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