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Bruno's Lunch Counter is expanding and expects operating cash flows of $30,900 a year for 6 years as a result. This expansion requires $99,500 in
Bruno's Lunch Counter is expanding and expects operating cash flows of $30,900 a year for 6 years as a result. This expansion requires $99,500 in new fixed assets. These assets will be worthless at the end of the project. In addition, the project requires $7,600 of net working capital throughout the life of the project. What is the net present value of this expansion project at a required rate of return of 13 percent?
a) $26,026
b)$27,885
c)$24,024
d)$20,075
e)$29,435
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