Dog Up$!$ Franks is looking at a new sausage system with an installed cost of $$385,000.$

This cost will be depreciated straight$-$line to zero over the project's five$-$year life, at the end of which the sausage system can be scrapped for $$60,000.$

The sausage system will save the firm $$135,000$ per year in pretax operating costs, and the system requires an initial investment in net working capital of $$35,000,$ which will be freed up

If the tax rate is $21$ percent and the discount rate is $10$ percent, what is the NPV of this project?

Should Franks undertake the project? Why or why not?

NPV