Quad Enterprises is considering a new 3-year expansion project that requires an initial fixed asset investment of $2.268 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 $176,400. The project requires an initial investment in net working capital of $252,000. The project is estimated to generate $2,016,000 in annual sales, with costs of $806,400. The tax rate is 24 percent and the required return on the project is 18 percent.

1. What is the project's Year 0 net cash flow?

a) -2,520,000

b) -2,646,000

c) -2,772,000

d) -2,394,000

e) -2,268,000

2. What is the project's Year 1 / 2 / 3 net cash flow?

a) 1,100,736

b) 1,155,773

c) 1,210,810

d) 1,045,699

e) 990,662

3. What is the NPV?

a) 108,271

b) -865,537

c) 1,251,613

d) 125,300

e) 113,685