Management is considering the following investment project: Project Delta

Capital Outlay

$$200000$

Cash Income per annum

$$120000$

Cash Expense per annum $($Other than Tax$)$

$$40,000$

Depreciation per annum

$$15000$

Economic Life

$6$ Years

Salvage Value

Nil

Tax Rate Payable $($Paid in year of income$)$

$20\%$

Required Rate of Return

$15\%$

Required:

Calculate the project$$s Net Present Value $($NPV$).$ Bases on NPV$,$ should project be accepted or rejected? $($Hint$,$ remember you have to first find annual NET cash flow for the project to calculate NPV$)$