Should Revolution Records have considered the land as part of the cash flow of the recording?studio? If?yes, what value should be?used, ?$420,000 or ?$750,000?

How will the value affect the?project?

Opportunity cast Revolution Records will build a new recording studio on a vacant lot next to the operations center. The land was purchased ve years ago for $420,000. Today, the value of the land has appreciated to $?50,000. Revolution Records did not consider the value ofthe land in its NPV calculations for the studio project (it had already spent the money to acquire the land long before this project was considered}. The NPV of the recording studio is $590,000. Should Revolution Records have considered the land as part ofthe cash flow ofthe recording studio? If yes, what value should be used, $420,000 or $350,000? How will the value affect the project'? Should Revolution Records have considered the land as part of the cash flow of the recording studio'i'I (Select the best response.)