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Savad Down Under Boomerang, Inc. is considering a new 3-year expansion project that requires an initial fixed asset investment of $2.35 million. The fixed asset

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Savad Down Under Boomerang, Inc. is considering a new 3-year expansion project that requires an initial fixed asset investment of $2.35 million. The fixed asset will be depreciated straight-line to zero over its 3-year tax life. The project is estimated to generate $1,745,000 in annual sales, with costs of $655,000. The project requires an initial investment in net working capital of $320,000, and the fixed asset will have a market value of $285,000 at the end of the project. a. If the tax rate is 22 percent, what is the project's Year O net cash flow? Year 17 Year 2? Year 3? (Do not round intermediate calculations and enter your answers in dollars, not millions of dollars, e.g., 1,234,567. A negative answer should be indicated by a minus sign.) b. If the required return is 11 percent, what is the project's NPV? (Do not round intermediate calculations and round your answer to 2 decimal places, e..., 32.16.) Year 0 cash flow Year 1 cash flow Year 2 cash flow Year 3 cash flow b. NPV

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