The Greentree Lumber Company is attempting to evaluate the profitability of adding another cutting line to its present sawmill operations. They would need to purchase two more acres of land for $30,000(total). The equipment would cost$136,000and could be depreciated over a five-year recovery period with the MACRS method. The new equipment is expected to increase gross revenue by$45,000per year for five years, and operating expenses will be$16,000annually for five years. It is expected that this cutting line will be closed down after five years. The firm's effective income tax rate is53%.If the company's after-tax MARR is33%per year, is this a profitable investment? Assume that land recovered at original cost of$30,000 at the end of five years. The market value of equipment is negligible at the end of year 5.

The Greentree Lumber Company is attempting to evaluate the profitability of adding another cutting line to its present sawmill operations. They would need to purchase two more acres of land for $30,000 (total) The equipment would cost $136.000 and could be depreciated over a five-year recovery period with the MACRS method. The new equipment is expected to increase gross revenue by $45.000 per year for five years, and operating expenses will be $16.000 annually for five years is expected that this cutting line will be closed down after five years. The firm's effective income tax rate is 53%. If the company's after-tax MARR is 3% per year is this a profitable investment? Assume that land recovered at original cost of $30.000 at the end of five years. The market value of equipment is negligible at the end of year 5. Click the icon to view the GDs Recovery Rates (k)for the 5ryear property class. Click the icon to view the interest and annuity table for discrete compounding when the MARR is 3% per year. Calculate the PW value for this investment. Pw 3%) (Round to the nearest dollar)