Quad Enterprises is considering a new 3-year expansion project that requires an initial fixed asset investment of $5.4 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 $420,000. The project requires an initial investment in net working capital of $600,000. The project is estimated to generate $4,800,000 in annual sales, with costs of $1,920,000. The tax rate is 24 percent and the required return on the project is 15 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?

Question 5

Quad Enterprises is considering a new 3-year expansion pr fixed asset investment of $5.4 million. The fixed asset will be zero over its 3-year tax life, after which time it will have a ma project requires an initial investment in net working capital estimated to generate $4,800,000 in annual sales, with costs is 24 percent and the required return on the project is 15 per What is the project's Year O net cash flow? What is the project's Year 1 net cash flow