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the following information for the next four questions: The Crimson Dawn Crime Syndicate is reviewing a potential investment project that would result in a new
the following information for the next four questions: The Crimson Dawn Crime Syndicate is reviewing a potential investment project that would result in a new starship that is rumored to be able to make the kessel run in under 12 parsecs. This project would entail a significant initial capital investment of $26,000,000 and these assets would need to be depreciated (straight-line to zero) over their 3 year life. The syndicate expects to be able to sell the assets for $9,750,000 at the end of the projects life. Quiz 10 The syndicate expects to be able to bring in additional revenue of $25,640,000 annually during the 3 year period, and estimates the projects operating costs (excluding depreciation) will be 25% of revenues. The syndicate would also need to commit initial working capital to the project of $2,500,000. While the syndicate is able to avoid most of it's taxes it does expect to pay an approximately 24% tax rate, and usually requires a 14% rate of return for projects of this risk level. What is the Cash Flow From Assets for Year 0 for this new project? Select one: O a. $ -29500000 O b. $ -27500000 O c. $ -26000000 O d. $ -28500000 O e. $ -30000000
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