G

Help Cash Flows And NPV Save & Bruin'S Den Outdoor Gear Is considering a new 7-year project to produce a new tent line. The equipment necessary would cost Sl.83 million and be ?preciated using straight-line depreciation to a book value of zero. At the end of the project, the equipment can be sold for 10 percent of its cost. The 'mpany believes that it can sell 29,000 tents per year at a price of $75 and variable costs of $34 per tent. The fixed costs be SSOS.OOO per year. The Oject will require an initial investment In net working capital of $237,000 that will be recovered at the end of the project. The required rate of return is 11.8 ?rcent and the tax rate Is 21 percent. What is the NPV? Multiple Choice C) $970,157 $775,494 $841,713 $859,316 44 of 60