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Could you please answer the questions in the attachment I have Provided. Thank you. Revenues generated by new fad product ere forecast as follows: Year
Could you please answer the questions in the attachment I have Provided. Thank you.
Revenues generated by new fad product ere forecast as follows: Year RevenueS S54.ooo 30,000 20,000 Thereafter Expenses are expected to be 50% of revenues. and working capltel requlred In each year Is expected to be of revenues In the following year. The product requlres an Immedlate Investment of S50,OOO In plant and equlpment. a. What Is the Inltlal Investment In the product? Remember working capltel. Investment b. If the plant and equipment are depreclad over 4 years to e selvage value of zero using strolght-llne depreciation. and the firm's tax rate Is 30%. what ore the project cash flows In each year? (Enter your answers In thousands of dollars. Do not round Intermedlete calculatlons. Round your answers to 2 decimal places.) Cosh HOW c. If the opportunity cost of capital Is 12%. what Is project NPV7 (Negative amount should be Indlcated by a minus slgn. Do not round Intermedlate calculatlons. Round your answer to 2 declmel places.) d. What Is project IRR? (Do not round Intermedlete calculations. Round your answer to 2 declmal places.)
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