Question
Quad Enterprises is considering a new 3-year expansion project that requires an initial fixed asset investment of $6.2 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 $6.2 million. The fixed asset falls into the 3-year MACRS class (MACRS Table) and will have a market value of $483,000 after 3 years. The project requires an initial investment in net working capital of $690,000. The project is estimated to generate $5,520,000 in annual sales, with costs of $2,208,000. The tax rate is 22 percent and the required return on the project is 10 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? |
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Fundamentals of Corporate Finance
Authors: Stephen M. Ross, Randolph W Westerfield, Robert R. Dockson, Bradford D Jordan
12th edition
007353062X, 73530628, 1260153592, 1260153590, 978-1260153590
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