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I need to calculate the NPV and IRR for a capital budgeting problem. Key Info: Equipment Costs- $325,000 Test Cost- $22.50/test Peronnel expense- $200,000/year Test
I need to calculate the NPV and IRR for a capital budgeting problem.
Key Info:
Equipment Costs- $325,000
Test Cost- $22.50/test
Peronnel expense- $200,000/year
Test Revenue- $500/test
Depreciation- straight line for 15 years = $21,667
First year will have 520 test, each year after will growth by 20%.
Tax rate of 35%
Discount rate of 10%
I calucalted NPV to be 56,066 and IRR to be 17.96%
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