Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Delia Landscaping is considering a new 4-year project. The necessary fixed assets will cost $195,000 and be depreciated on a 3-year MACRS and have no

image text in transcribed

image text in transcribed

Delia Landscaping is considering a new 4-year project. The necessary fixed assets will cost $195,000 and be depreciated on a 3-year MACRS and have no salvage value. The MACRS percentages each year are 33.33 percent, 44.45 percent, 14.81 percent, and 7.41 percent, respectively. The project will have annual sales of $132,000, variable costs of $35,500, and fixed costs of $12,850. The project will also require net working capital of $3,450 that will be returned at the end of the project. The company has a tax rate of 21 percent and the project's required return is 12 percent. What is the net present value of this project? Multiple Choice $37,403 $22,256 $25,053 $18,989 $20,716

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Essentials Of Investments

Authors: Zvi Bodie, Alex Kane, Alan J. Marcus

7th Edition

0073368717, 978-0073368719

More Books

Students also viewed these Finance questions

Question

In what ways are cities ecosystems?

Answered: 1 week ago