Relevant Information on Company ABC and Project P (The New Show):

• Company ABC is now selling for $21 per share and has 14,500,000 outstanding common shares.
• Company ABC has an equity () of 0.93.
• A dividend of $0.51 was just paid to all of the common shareholders and analysts estimate that it will grow steadily at 5% per year.
• Company ABC is now selling for $25 per share and has 1,550,000 outstanding preferred shares with a $2.5 dividend.
• Company ABC has an AA rating bond, currently quoted at 110.
• Company ABCs coupon rate is 9.5% with semi-annual coupons.
• Company ABC has 76,000 outstanding bonds and time to maturity is 15 years.
• You also observe the beta () of 3 companies that focus on producing tv shows: Jimmy Kimmel Live - = 1.35, The Daily Show - = 1.07, and The View - = 1.24.
• The expected market return is 6.5%, the risk-free risk rate is 1.8%, and the corporate tax rate is 42%.

Additional Information on Company ABC and Project P (The New Show):

• The project is expected to last 4 years.
• Company ABC is planning to spend $2,100,000 on fixed assets such as equipment.
• Alex Reid (CEO) has already spent $140,000 on consultancy to check the feasibility of the project.
• Company ABC already bought an idle building (building that hasnt been used yet) a few years ago.
• The ops manager suggested that the building is perfect to film Project Ps The New Show and it is worthy of $500,000 if it is sold on the market today.
• The projected sales for the 4 years are: $1,600,000, $1,800,000, $1,700,000, and $1,900,000.
• The variable cost is 50% of the projected sales and the fixed cost is $550,000 per year.
• Company ABC estimates its increases in gross profit from other existing projects to be $6,000,000, $4,000,000, $5,000,000, and $7,000,000 for Years 1-4, respectively.
• Company ABC thinks 20%, 50%, 30%, 10% of these increases in gross profit, respectively, are due to the introduction of Project P.
• The initial net working capital is going to be $150,000, NWC increases by 200,000 for Y1, decreases by 77,000 for Y2, increases by 130,000 for Y3, and increases by 54,000 for Y4.
• Company ABC is expecting to recover 80% of its initial NWC at the end of the project.
• If the building and the equipment belong to Class 8, and there is an annual CCA rate of 20%, and the total capital spending is estimated to have a salvage value of $1,100,000 at the end of the project.

QUESTION: Find the NPV of this project today? (Find WACC using discount rate, CAPM for common shares and Dividend Discount Model for preferred shares when finding the cost of equity. When calculating cost of debt, use EAR, not YTM)

PLEASE SHOW ALL WORK AND STEP BY STEP CALCULATIONS!!!