Shanks Corporation is considering a capital budgeting project that inolves investiong &600.00 in equipment that would have a useful life of 3 years and zerp salvege value. The company would also need invest $20.000 immediately in working capital which be released for use elesewhere at the end of the project in 3 years. The net annual operationg cash inflow, which in the difference between the incremental sales revenue and incremental cash operationg expenses, would be $300.000 per year. The project would require a one-time renovation expenses of $60.000 at the end of year 2. The company uses straight- line depreciation and the depreciation expenses on the equipment would be $200.000 per year. Assme cash flow occur at the end of the year expect for the initial investment. The company takes income taxes into account in its capital budgetiong. The income tax rate is 35%. The after-tax discount rate is 15%.

Required:

Determine the net present value of the project. Show all your work.