Quad Enterprises is considering a new three-year expansion project that requires an initial fixed asset investment of $2.9 million. The fixed asset will be depreciated on a three-year MACRS schedule. The project is estimated to generate $2,190,000 in annual sales, with costs of $815,000. The project requires an initial investment in net working capital of $300,000, and the fixed asset will have a market value of $210,000 at the end of the project. What is the project's Year 0 net cash flow? Year 1? Year 2? Year 3? The tax rate is 21 percent. If the required return is 12 percent, what is the project's NPV? Asset investment $ Estimated annual sales $ Costs $ Net working capital $ Pretax salvage value $ Tax rate Project and asset life Required return MACRS percentages Year 1 Year 2 Year 3 2,900,000 2,190,000 815,000 300,000 210,000 21% 3 12% 0.3333 0.4445 0.1481 FILE Paste Clipboard A1 20 AE HOME Calibri B IU Net income NPV INSERT 21 22 Sales 23 Costs 24 Depreciation 25 EBT 26 Taxes 27 28 29 30 31 32 Aftertax salvage value 33 Sell equipment 34 Taxes 35 Aftertax cash flow 36 37 38 39 OCF 40 41 42 43 44 READY Attempt(s) I Net cash flow Fixed asset book value in three years Capital spending Net working capital Font Sheet1 11 PAGE LAYOUT A A D H C Complete the following analysis. Do not hard code values in your calculations. You must use the built-in Excel function to calculate the NPV. Calculating NPV - Excel DATA FORMULAS Alignment Number E REVIEW F VIEW Conditional Format as Cell Formatting Table Styles Styles G Cells Editing 14 E | Sign In J + 60%