Using excel, solve the following problems:

Part 1

Calculating Project OCF. Quad Enterprises is considering a new three-year expansion project that requires an initial fixed asset investment of $2.9 million. The fixed asset will be depreciated straight-line to zero over its three-year tax life, after which time it will be worthless. The project is estimated to generate $2,190,000 in annual sales, with the costs of $815,000. If the tax rate is 35 percent, what is the OCF for this project?

Part 2

Calculating Project NPV. In the previous problem, suppose the required return on the project is 12 percent. What is the project's NPV?