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Q7 Question 7 10 Points The following data relate to an investment proposal. The project's estimated life is 3 years, its cost is $360,000 and

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Q7 Question 7 10 Points The following data relate to an investment proposal. The project's estimated life is 3 years, its cost is $360,000 and the operating net cash flows is $220,000 per annum (real and before tax) and the salvage value is $25,000 (real and before tax) on which the full amount is subject to tax. The annual straight-ine depreciation is $120,000 per annum (nominal and before tax), the opportunity cost of capital is 8.15% per annum (nominal and after tax) and the interest expense is $30,000 per annum (nominal and before tax). The anticipated inflation rate is 3% per annum and the company's tax rate is 30%. Assume that the turnover for the company is $50 million. All calculations are to be in a nominal, after-tax basis. Note: You may type your responses to each part in the spaces provide below. Alternatively, you may upload your handwritten and scanned answers to each question part below. (Do not upload the answers to any other questions here as they will not be marked.) Q7.1 Question 71 1 Point Calculate the discount rate used to discount the cash flows. Show all calculations. Please select file(s) Select file(s) Enter your answer here Q7.2 Question 72 3 Points Calculate the operating net cash flows for each year of the project expressed as a present value at the start of the project. Show all calculations. Q7.2 Question 7.2 3 Points Calculate the operating net cash flows for each year of the project expressed as a present value at the start of the project. Show all calculations. Please select files) Select file(s) Enter your answer here Q7.3 Question 7.3 1 Point Calculate the salvage value of the project life expressed as a present value at the start of the project. Show all calculations. Please select file(s) Select file(s) Enter your answer here Q7.4 Question 7.4 2 Points Calculate any other non-cash flow items that would provide an indirect tax benefit for each year of the project's life expressed as a present value at the start of the project Show all calculations Please select files) Select files)

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