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Open company already invested Tsh 5 0 mil in research to have ABC prototype product. Project will involve spend Tsh 8 0 0 mil to
Open company already invested Tsh mil in research to have ABC prototype product. Project will involve spend Tsh mil to acquisition plant and machinery and will be shipped at cost of Tsh mil while installation and commission cost is estimated Tsh mil. Company take advantage own warehouse. However warehouse is rented out to other company annual Tsh Mil. The company will also incur net working investment Tshmil, initially. Plant will have a useful life of years, at the end of which plant will be sold and estimate to ferch Tsh Mil. If project successfully launched it will contribute additional annua cash flow Tsh mil. The company will also spend annual Tsh mil in operating cost other than deprecion interest and tax. Furthermore project will inject Tsh annual for two years as additional working capital at the end o and years respectively. the effective rate tax is payable in the same year revenueis earned and the rate is not expected to change over the project life. Plant and machinery will be depreciation at rate using reducing balance method. Using spreadsheet calculate NPV and present answer in excel sheel
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