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please solve with excel Better Mousetrap's research laboratories have developed a new trap. The project requires an initial investment in plant and equipment of $6

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please solve with excel

Better Mousetrap's research laboratories have developed a new trap. The project requires an initial investment in plant and equipment of $6 million. This investment will be depreciated straight-line over five years to a value of zero, but when the project comes to an end at the end of five years, the equipment will, in fact, be sold for $500,000. The firm believes that working capital at each date must be maintained at 10% of next year's forecasted sales starting immediately. Production costs are estimated at 25% of revenues. There are no marketing expenses. Sales forecasts are given in the following table. The firm pays tax at 25% and the required return on the project is 12%. What is the NPV? Year : sales =0 Million Year 1: sales=2.0 Million Year 2: sales=2.4 Million Year 3: sales= 4.0 Million Year 4: sales= 4.0 Million Year 5: sales=2.4 Million A $1,027,165 B) $1,046,941 C) $1,047,344 $1,117,870 E $1,297,741 year o year 1 year 2 year 3 2000000 2400000 year 4 year 5 4000000 4000000 2400000 Sales Costs Gross profit Depreciation Taxable income Tax Net income OCF year o year 1 year 2 year 3 year 4 year 5 200000 Working capital Change in working capital CF from changes in working capital year o year 1 year 2 year 3 year 4 year 5 after-tax salvage value CF from capital investment -6000000 year o year 1 year 2 year 3 year 4 year 5 OCF CF from changes in working capital CF from capital investment Total cash flow NPV

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