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Find the net cash flow for: Year 0 Year1-2 Year 3 Year 4 Year 5 You work at Beth's Canoe Shop and are considering the
Find the net cash flow for:
Year 0
Year1-2
Year 3
Year 4
Year 5
You work at Beth's Canoe Shop and are considering the purchase of new forklifts to speed up the warehousing of canoes. The forklifts will cost $750,000 and will speed up the process enough to increase revenues by $600,000 per year for each of the next 5 years. Additional maintenance costs for the forklifts will be $50,000 per year. The forklifts will be fully depreciated over this time, and then sold for $100,000. The project will require a change in working capital of $80,000, with half recovered in 3 years and the rest in 5 years. If the marginal tax rate is 30% and the cost of capital is 12%, find the net cash flowStep by Step Solution
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