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Summer Time, Inc., is considering a new 3-year expansion project that requires an initial fixed asset investment of $3.6 million. The fixed asset falls into
Summer Time, Inc., is considering a new 3-year expansion project that requires an initial fixed asset investment of $3.6 million. The fixed asset falls into the 3-year MACRS class (MACRS Table) and will have a market value of $281, 400 after 3 years. The project requires an initial investment in net working capital of $402,000. The project is estimated to generate $3, 216,000 in annual sales, with costs of $1, 286, 400. The tax rate is 32 percent and the required return on the project is 10 percent. (Do not round your intermediate calculations.) Required: What is the project's year 0 net cash flow? (Click to select) What is the project's year 1 net cash flow? (Click to select) What is the project's year 2 net cash flow? (Click to select) What is the project's year 3 net cash flow? (Click to select) What is the NPV? (Click to select)
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