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Quad Enterprises is considering a new 3-year expansion project that requires an initial fixed asset investment of $3.9 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 $3.9 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 $306,600 after 3 years. The project requires an initial investment in net working capital of $438,000. The project is estimated to generate $3,504,000 in annual sales, with annual production costs of $1,401,600. The tax rate is 22 percent and the required return on the project is 11 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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