D 2 H 3 Quad Enterprises is considering a new three-year expansion project that requires an initial fixed asset investment of $2.9 million. The fixed asset will be depreciated on a three-year MACRS schedule. The project is estimated to generate $2,190,000 in annual sales, with costs of $815,000. The project requires an initial investment in net working capital of $300,000, and the fixed asset will have a market value of $210,000 at the end of the project. What is the project's Year 0 net cash flow? Year 12 Year 22? Year 3? The tax rate is 21 percent. If the required return is 12 percent, what is the project's NPV? 4 5 6 Asset investment $ 2,900,000 2,190,000 7 Estimated annual sales $ Costs 815,000 Net working capital 300,000 3 of 14 www. *** Next > 89 5555 $ Prev EB Calibri BIU V 11 ste UE pboard Font X 1 AB C $ Asset investment Estimated annual sales $ Costs $ Net working capital $ Pretax salvage value Tax rate Project and asset life Required return MACRS percentages Year 1 Year 2 Year 3 33 $ % Y A Alignment Number fx E 10 D 2,900,000 2,190,000 815,000 300,000 210,000 21% 3 12% 0.3333 0.4445 0.1481 F Paste Clipboard F A1 21 22 Sales 23 Costs 24 Depreciation 25 EBT 26 Taxes 27 Net income 28 29 Fixed asset book value 30 in three years 31 32 Aftertax salvage value 33 Sell equipment RA Tavne BIU. Font 1 X 1. fx Alignment Number Conditional Format as Cell Cells Formatting Table Styles. Styles 19 - D Editing Clipboard G A1 1 C 30 in three years 31 32 Aftertax salvage value 33 Sell equipment 34 Taxes 35 Aftertax cash flow 36 37 Capital spending Net working capital 39 OCF Net cash flow NPV 7 38 39 40 4 2 3 4 45 41 42 43 Fore X 44 f