Question
The necessary foundry equipment will cost a total of $4,500,000 and will be depreciated using a five year MARCS life, ? the sales manager has
The necessary foundry equipment will cost a total of $4,500,000 and will be depreciated using a five year MARCS life, ? the sales manager has an estimate for the sale of classic Thunderbirds, the annual sales volume will be as follows; ? Year one: 230. Year two: 280. Year three: ?320 Year four: 380Year five: 320? If the sales price is 28,000 per car, variable cost are 16,000 per car, and fixed cost are 1,200,000 annually what is the annual operating cash flow at the tax rate is 30%? The equipment is sold for salvage for $500,000 at the end of year five. Networking capital increases by $600,000 at the beginning of the project year 0 and is reduced back to its original level in the final year. Find the internal rate for the project using the incremental cash flows.
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