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KADS, Incorporated has spent $400,000 on research to develop a new computer game. The firm is planning to spend $150,000 on a machine to produce

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KADS, Incorporated has spent $400,000 on research to develop a new computer game. The firm is planning to spend $150,000 on a machine to produce the new game. Shipping and installation costs of the machine will be capitalized and depreciated; they total 550,000 . The machine has an expected life of three years, a $75,000 estimated resale value, and falls under the MACRS sevenyear class life Revenue from the new game is expected to be $600,000 per year, with costs of $250,000 per year. The firm has a tax rate of 21 percent. an opportunity cost of capital of 15 percent, and it expects net working capital to increase by $100,000 at the beginning of the project. What will the year 0 free cash flow for this project be? willat will wit year u llee casil iluw iui uns piuject ve: Multiple Choice $250,000 $150,000 $200,000 $300,000

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