Question
Quad Enterprises is considering a new 3-year expansion project that requires an initial fixed asset investment of $2.8 million. The fixed asset falls into the
Quad Enterprises is considering a new 3-year expansion project that requires an initial fixed asset investment of $2.8 million. The fixed asset falls into the 3-year MACRS class (MACRS Table) (TIP: make sure you refer to this MACRS table! The one on our PowerPoint slides may have slightly different numbers) and will have a market value of $214,200 after 3 years. The project requires an initial investment in net working capital of $306,000. The project is estimated to generate $2,448,000 in annual sales, with annual production costs of $979,200. The tax rate is 22 percent and the required return on the project is 8 percent.
What is the project's year 0 net cash flow?
What is the project's year 1 net cash flow?
What is the project's year 2 net cash flow?
What is the project's year 3 net cash flow?
What is the NPV?
Can I please see how this is done on an excel with formulas, please and thank you!
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