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Intro DeLuxe Furniture is thinking of buying a wood cutting machine for $170,000 that would save it $35,000 per year in production costs. The savings

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Intro DeLuxe Furniture is thinking of buying a wood cutting machine for $170,000 that would save it $35,000 per year in production costs. The savings would be constant over the project's 3-year life. The machine is to be linearly depreciated to zero and will have no resale value after 3 years. The machine would require an additional $9,000 in net working capital. The appropriate cost of capital for this project is 11% and the company's tax rate is 35%. Year Year 1 Year 2 Year 3 0 35,000 56,667 0 -21,667 0 35,000 56,667 -21,667 35,000 56,667 -21,667 Cost savings Depreciation EBIT Taxes (35%) Net income Depreciation OCF NCS ANWC CFA 18 Attempt 1/10 for Part 4 What is the cash flow from assets in year 3? Hint: add the recovery of net working capital. 0+ decimals Submit LB Attempt 1/10 for Part 5 What is the NPV of this project? 0+ decimals

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