Answered step by step
Verified Expert Solution
Question
1 Approved Answer
IN EXCEL FORMULA AND BE CLEAR PLEASE. THANK YOU! A B D E F G H 3 Quad Enterprises is considering a new three-year expansion
IN EXCEL FORMULA AND BE CLEAR PLEASE. THANK YOU!
A B D E F G H 3 Quad Enterprises is considering a new three-year expansion project that requires an initial fixed asset investment of $2.9 million. The fixed asset will be depreciated straight-line to zero over its three-year tax life. The project is estimated to generate $2,190,000 in annual sales, with costs of $815,000. The project requires an initial investment in net working capital of $300,000, and the fixed asset will have a market value of $210,000 at the end of the project. What is the project's Year O net cash flow? Year 1? Year 2? Year 3? The tax rate is 21 percent. If the required return is 12 percent, what is the project's NPV? 4 5 6 $ $ 7 8 A A A A A $ 9 Asset investment Estimated annual sales Costs Net working capital Pretax salvage value Tax rate Project and asset life Required return $ 2,900,000 2,190,000 815,000 300,000 210,000 21% 3 12% 10 11 12 13 14 15 16 Complete the following analysis. Do not hard code values in your calculations. You must use the built-in Excel function to calculate the NPV. A B D E F G H 15 16 Complete the following analysis. Do not hard code values in your calculations. You must use the built-in Excel function to calculate the NPV. 17 18 19 Aftertax salvage value Sell equipment Taxes Aftertax cash flow 20 21 22 23 24 25 Sales Costs Depreciation EBT Taxes Net income 26 27 28 29 30 31 Capital spending Net working capital OCF Net cash flow 32 33 34 35 NPV 36Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started