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Quad Enterprises is considering a new 3-year expansion project that requires an initial fixed asset investment of $2.1 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 $2.1 million. The fixed asset falls into the 3-year MACRS class (MACRS Table) and will have a market value of $159,600 after 3 years. The project requires an initial investment in net working capital of $228,000. The project is estimated to generate $1,824,000 in annual sales, with costs of $729,600. The tax rate is 25 percent and the required return on the project is 11 percent. Calculate the project net cash flow from year 0 to year 3.
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