{ "key_pair_value_system": true, "answer_rating_count": "", "question_feedback_html": { "html_star": "", "html_star_feedback": "" }, "answer_average_rating_value": "", "answer_date_js": "2024-06-06T13:04:42-04:00", "answer_date": "2024-06-06 13:04:42", "is_docs_available": "", "is_excel_available": "", "is_pdf_available": "", "count_file_available": 0, "main_page": "student_question_view", "question_id": "2366396", "url": "\/study-help\/questions\/question-2-15-donttry-inc-is-planning-a-new-production-2366396", "question_creation_date_js": "2024-06-06T13:04:42-04:00", "question_creation_date": "Jun 06, 2024 01:04 PM", "meta_title": "[Solved] Question 2 [15%] DontTry Inc. is planning | SolutionInn", "meta_description": "Answer of - Question 2 [15%] DontTry Inc. is planning a new production facility that will last for 15 years. The project requires | SolutionInn", "meta_keywords": "question,2,15%,donttry,inc,planning,new,production,facility,will,15,years", "question_title_h1": "Question 2 [15%] DontTry Inc. is planning a new production facility that will last for 15 years. The project requires a new equipment and a", "question_title": "Question 2 [15%] DontTry Inc. is planning a new production facility that", "question_title_for_js_snippet": "Question 2 15 DontTry Inc is planning a new production facility that will last for 15 years The project requires a new equipment and a piece of land the company owns The land has a cost of $950,000 and now has a market value of $300,000 Currently, the land has been leased to another company for $12,000 per year for the next 15 years To cancel the lease, DontTry has to pay a nontaxdeductible penalty of $10,000 The required equipment (CCA rate of 30 ) has a cost of $200,000 The additional revenues and operating costs are $130,000 and $715,000 in the rst year and increase 2 and 3 per year respectively At the end of the project, the land is estimated to have a market value of $900,000 and the equipment will be sold for $20,000 The net working capital requirement at the beginning of the project is $90,000 and decrease $4,500 per year The asset class remains open and has an UCC of $15,000 before the sale of the equipment If the tax rate is 25 and the discount rate is 10 , determine the NPV of this project", "question_description": "\"image
\"image<\/div><\/div><\/div> Question 2 [15%] DontTry Inc. is planning a new production facility that will last for 15 years. The project requires a new equipment and a piece of land the company owns. The land has a cost of $950,000 and now has a market value of $300,000. Currently, the land has been leased to another company for $12,000 per year for the next 15 years. To cancel the lease, DontTry has to pay a nontaxdeductible penalty of $10,000. The required equipment (CCA rate of 30%) has a cost of $200,000. The additional revenues and operating costs are $130,000 and $715,000 in the rst year and increase 2% and 3% per year respectively. At the end of the project, the land is estimated to have a market value of $900,000 and the equipment will be sold for $20,000. The net working capital requirement at the beginning of the project is $90,000 and decrease $4,500 per year. The asset class remains open and has an UCC of $15,000 before the sale of the equipment. If the tax rate is 25% and the discount rate is 10%, determine the NPV of this project", "transcribed_text": "", "related_book": { "title": "Algebra and Trigonometry", "isbn": "9781337514255, 1337271179, 133751425X, 978-1337271172", "edition": "10th edition ", "authors": "Ron Larson", "cover_image": "https:\/\/dsd5zvtm8ll6.cloudfront.net\/si.question.images\/book_images\/1383.jpg", "uri": "\/textbooks\/algebra-and-trigonometry-10th-edition-1383", "see_more_uri": "" }, "free_related_book": { "isbn": "3319810154", "uri": "\/textbooks\/essays-in-mathematics-and-its-applications-in-honor-of-vladimir-arnold-1st-edition-978-3319810157-347047", "name": "Essays In Mathematics And Its Applications In Honor Of Vladimir Arnold", "edition": "1st Edition" }, "question_posted": "2024-06-06 13:04:42", "see_more_questions_link": "\/study-help\/questions\/business-banking-2021-September-12", "step_by_step_answer": "The Answer is in the image, click to view ...", "students_also_viewed": [ { "url": "\/1-should-mark-prevail-2-is-it-relevant-that-fsc", "description": "1. 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