Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Question 15 10 pts Fun Land is considering adding a miniature golf course to its facility. The course would cost $60000, would be depreciated on
Question 15 10 pts Fun Land is considering adding a miniature golf course to its facility. The course would cost $60000, would be depreciated on a straight line basis over its 4-year life, and would have a zero salvage value. The estimated income from the golfing fees would be $30000 a year with $9000 of that amount being variable cost. The fixed cost would be $9000. In addition, the firm anticipates an additional $12000 in revenue from its existing facilities if the course is added. The project will require $6000 of net working capital, which is recoverable at the end of the project. What is the net present value of this project at a discount rate of 10 percent and a tax rate of 40 percent? $1,089.59 $7,451.89 O $2,763.34 O $5,390.77 $9,444.03
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started