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Quad Enterprises is considering a new 3 - year expansion project that requires an initial fixed asset investment of $ 3 . 0 2 4

Quad Enterprises is considering a new 3-year expansion project that requires an initial fixed asset investment of $3.024 million. The fixed asset will be depreciated straight-line to zero over its 3-year tax life, after which time it will have a market value of $235,200. The project requires an initial investment in net working capital of $336,000. The project is estimated to generate $2,688,000 in annual sales, with costs of $1,075,200. The tax rate is 24 percent and the required return on the project is 15 percent.
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