Use the following information to value the project. Comet Camping is considering the introduction of a new line of sleeping bags. The project requires an initial investment of $800,000 in fixed assets, which they believe can be sold for $525,000 at the end of the project. The project would use a parcel of land Comet purchased two years ago for $100,000 which now has a market value of $200,000. Assume the land is expected to retain its market value for the duration of the project. Comet spent $50,000 on a feasibility study in order to generate the following pro forma financial statements.

Year			1	2	3	4
Sales			360,000	600,000	720,000	715,000
Variable Costs			180,000	300,000	360,000	390,000
Fixed Costs			25,000	25,000	25,000	25,000
Depreciation			114,320	195,920	139,920	99,920
EBIT			40,680	79,080	195,080	200,080
Taxes			8,543	16,607	40,967	42,017
Net Income			32,137	62,473	154,113	158,063

Year	0	1	2	3	4
Net Working Capital	25,000	25,000	25,000	25,000	25,000
Net Fixed Assets	800,000	685,680	489,760	349,840	249,920

If undertaken, the project is expected to have similar risks as existing operations and will be financed with the same mix of debt and equity. Comet has 2 million shares outstanding priced at $12 per share. Comet also has 10,000 bonds outstanding with a face value of $1,000 each. These bonds have a coupon rate of 11%, make payments on a semi-annual basis, and have 26 years to maturity. The current market price is $1,250 per Comet bond. Treasury bills currently yield 4% per annum. The S&P 500 has an expected return of 11% and a variance of returns of 2.25. Comet stock has a beta of 1.20 and a standard deviation of returns of 1.75. The marginal tax rate is 21% and the Consumer Price Index is expected to continue growing at 2% per annum for the foreseeable future.