FLIR is considering the purchase of a new manufacturing facility to produce drones that would cost $2,650,000. The facility is to be fully depreciated on a straight-line basis over 3 years. It is expected to have a scrap resale value of $250,000 at the end of 3 years. Toxic waste cleanup, at the end of the project life, is expected to cost $500,000, after taxes, Operating revenues from the facility are expected to be $1,950,000, and production costs are estimated at $525,000 for all years of operation, starting in T1. No inflation is expected. If the project is undertaken, a working capital investment of $250,000 is expected at the time of facility purchase, with full recovery at the end of the project life. The company uses a 9% discount rate for these types of projects; the corporate tax rate is 40 percent. FLIR has other ongoing profitable operations. Should the company undertake the project?

Determine the Operating cash flows for the project in all years.

Show the total cash flows of the project below that you will use for the NPV.

What is the project NPV? It's MIRR?

Determine the Terminal Value at the end of the project.