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Hurzdan, Inc., is considering the purchase of a $379,000 computer with an economic life of four years. The computer will be fully depreciated over four
Hurzdan, Inc., is considering the purchase of a $379,000 computer with an economic life of four years. The computer will be fully depreciated over four years using the straight-line method. The market value of the computer will be $79,000 in four years. The computer will replace four office employees whose combined annual salaries are $124,000. The machine will also immediately lower the firms required net working capital by $99,000. This amount of net working capital will need to be replaced once the machine is sold. The corporate tax rate is 24 percent. The appropriate discount rate is 14 percent. |
Calculate the NPV of this project. (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) |
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