Oakmont Company has an opportunity to manufacture and sell a new product for a four-year period. The companys discount rate is 18%. After careful study, Oakmont estimated the following costs and revenues for the new product:

Cost of equipment needed		$	160,000
Working capital needed		$	66,000
Overhaul of the equipment in two years		$	11,000
Salvage value of the equipment in four years		$	15,000
Annual revenues and costs:
Sales revenues		$	310,000
Variable expenses		$	150,000
Fixed out-of-pocket operating costs		$	76,000

When the project concludes in four years the working capital will be released for investment elsewhere within the company.

Use Excel or a financial calculator to solve.

Required:

Calculate the net present value of this investment opportunity. (Round to the nearest dollar.)

Oakmont Company has an opportunity to manufacture and sell a new product for a four-year period. The company's discount rate is 18%. After careful study, Oakmont estimated the following costs and revenues for the new product Cost of equipment needed Working capital needed Overhaul of the equipment in two years Salvage value of the equipment in four years $160,000 $66,000 $ 11,000 $ 15,000 Annual revenues and costs: Sales revenues Variable expenses Fixed out-of-pocket operating costs $ 310,000 $150,000 $ 76,000 When the project concludes in four years the working capital will be released for investment elsewhere within the company. Use Excel or a financial calculator to solve Required: Calculate the net present value of this investment opportunity. (Round to the nearest dollar.) Answer is complete but not entirely correct. Net present value $ 65,903