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if you could show the formula you use that would be great QUESTION 6 Benny currently works for Waste Magic Inc, a company that collects
if you could show the formula you use that would be great
QUESTION 6 Benny currently works for Waste Magic Inc, a company that collects e-waste and turns it magically into garden equipment. The company is thinking about opening another manufacturing plant in Adelaide. The company employed ConsultMe to conduct a feasibility study. The cost of this study was $10,000 and provided the following information: Revenue resulting from the new plant is expected to be $ 774,000 per year and yearly costs to be $ 433,000. The revenue from another plant the company owns just outside of Adelaide is expected to go down by $10,000/yr. The new plant is expected to operate for 7 years, and both the revenues and costs are expected to remain constant. The plant will costs $1,382,000 and ATO rules require that the plant be depreciated to zero over 7 years. At the end of the 7 years, the company expects to be able to sell the plant for $ 83,000. The project will also require an initial working capital of $5,000, which will be recovered at the end of the project. Assuming a tax rate of 35% and a required return of 6% p.a., what is the expected NPV? Round your answer to two decimalsStep by Step Solution
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