Problem $18-17$ APV

Digital Organics $($DO$)$ has the opportunity to invest $$1\mathrm{.}08$ million now $($t $=0)$ and expects after$-$tax returns of $$680,000$ in t $=1$ and $$780,000$ in t $=2.$ The project will last for two years only. The appropriate cost of capital is $11\%$ with all$-$equity financing, the borrowing rate is $7\%,$ and DO will borrow $$380,000$ against the project. This debt must be repaid in two equal installments of $$190,000$ each. Assume debt tax shields have a net value of $$0\mathrm{.}20$ per dollar of interest paid.

Calculate the project$$s APV.

Note: Enter your answer in dollars, not millions of dollars. Do not round intermediate calculations. Round your answer to the nearest whole number.