NPV.Mathews Mining Company is looking at a project that has the following forecasted sales: first-year sales are 7,000 units, and sales will grow at 12% over the next four years (a five-year project). The price of the product will start at $ 121.00 per unit and will increase each year at 5%. The production costs are expected to be 59% of the current year's sales price. The manufacturing equipment to aid this project will have a total cost (including installation) of $1,300,000. It will be depreciated using MACRS, and has aseven-year MACRS life classification. Fixed costs will be $55,000 per year. Mathews Mining has a tax rate of 30%. What is the operating cash flow for this project over these five years? Find the NPV of the project for Mathews Mining if the manufacturing equipment can be sold for $70,000 at the end of the five-year project and the cost of capital for this project is 14%.

What is the operating cash flow for this project in year 1?

What is the operating cash flow for this project in year 2?

What is the operating cash flow for this project in year 3?

What is the operating cash flow for this project in year 4?

What is the operating cash flow for this project in year 5?

What is the book value of the manufacturing equipment after five years? _____________ Round to nearest dollar

What is the gain (or loss) for the sales of the manufacturing equipment after 5 years? _____________ Round to nearest dollar

What is the after-tax cash flow of the manufacturing equipment at disposal? _____________ Round to nearest dollar

What is the NPV of the project? _____________ Round to nearest dollar