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thanks in advance, . Kurt's Cabinets is looking at a project that will require $100,000 in fixed assets and require another $20,000 in net working
thanks in advance,
. Kurt's Cabinets is looking at a project that will require $100,000 in fixed assets and require another $20,000 in net working capital. The project is expected to produce sales of $110,000 with associated costs of $70,000. The project has a 4-year life. The company uses straight-line depreciation to a zero book value over the life of the project. The tax rate is 35 %. 1) What is the initial cost for this project? 2) At the end of this project, the company could free up $20,000 in net working capital and sell the fixed asset at $10,000. The tax rate ofcapital gain is 35%. What is the total cash flow (including operating cash flow) at Year 4? 3) What is the NPV for this project at 10 percent discount rateStep by Step Solution
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