Question
Please use EXCEL Scholastic Co. is evaluating a machine with an initial cost of $450,000 and a five-year life that costs $85,000 per year to
Please use EXCEL
Scholastic Co. is evaluating a machine with an initial cost of $450,000 and a five-year life that costs $85,000 per year to operate (assume sales = $0). The firm uses straight-line depreciation; the applicable discount rate is 9%. The machine will have a salvage value of $100,000 at the end of the project's life. The firm has a tax rate of 21%. Note: do not include the salvage value when calculating the annual depreciation expense.
Calculate the operating cash flow in year 1. (Enter a negative value)
Calculate the NPV of the project. (Enter a negative value and round to 2 decimals)
Calculate the EAC for the project. (Enter a positive value and round to 2 decimals)
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