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DeLuxe Furniture is thinking of buying a wood cutting machine for $190,000 that would save it $40,000 per year in production costs. The savings would
DeLuxe Furniture is thinking of buying a wood cutting machine for $190,000 that would save it $40,000 per year in production costs. The savings would be constant over the project's 3 -year life. The machine is to be linearly depreciated to zero and will have no resale value after 3 years. The machine would require an additional $6,000 in net working capital. The appropriate cost of capital for this project is 13% and the company's tax rate is 35% What is the cash flow in year 0? Choose the right sign. Attempt 1/20 for 10 pts. - 18 Attempt 1/20 for 10 pts. What is the cash flow in year 1 ? - Attempt 1/20 for 10 pts. Whet is the cesh flow in year 2 ? Whet is the cesh flow in year 3? Hint: add the recovery of net wortong cepital
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