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i need an answer and explanation to my finance problem. A firm is considering a project with the following information: - Project will require purchase
i need an answer and explanation to my finance problem.
A firm is considering a project with the following information: - Project will require purchase of a machine for $110,841.00 that is MACRS depreciable over a five-year schedule. (no depreciation until end of year 1 ). - Project will require immediate non-depreciable expenses of \$26,540.00 TODAY (year 0). - Project will have the following projected balance sheet values of NWC: - Sales for the project will be $55,071.00 per year, with all other expenses (excluding depreciation) at 47.00% of sales. - The tax rate for the firm is 40.00%, while the cost of capital is 10.00% "assume project goes beyond two years What is the project cash flow for year 0 ? Answer Format: Currency: Round to: 2 decimal places Step by Step Solution
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