You are evaluating a project for The Ultimate recreational tennis racket, guaranteed to correct that wimpy backhand. You estimate the sales price of The Ultimate to be $430 per unit and sales volume to be 1,000 units in year 1; 1,250 units in year 2; and 1,325 units in year 3. The project has a 3-year life. Variable costs amount to $240 per unit and fixed costs are $100,000 per year. The project requires an initial investment of $174,000 in assets, which will be depreciated straight-line to zero over the 3-year project life. The actual market value of these assets at the end of year 3 is expected to be $38,000. NWC requirements at the beginning of each year will be approximately 25 percent of the projected sales during the coming year. The tax rate is 34 percent and the required return on the project is 10 percent. (Use SL depreciation table)

What will the cash flows for this project be? (Negative amounts should be indicated by a minus sign. Do not round intermediate calculations. Round your final answers to 2 decimal places.)

Year	0		1		2		3
Total cash flow	$		$		$		$

KADS, Inc., has spent $330,000 on research to develop a new computer game. The firm is planning to spend $130,000 on a machine to produce the new game. Shipping and installation costs of the machine will be capitalized and depreciated; they total $43,000. The machine has an expected life of three years, a $68,000 estimated resale value, and falls under the MACRS 7-year class life. Revenue from the new game is expected to be $530,000 per year, with costs of $180,000 per year. The firm has a tax rate of 40 percent, an opportunity cost of capital of 13 percent, and it expects net working capital to increase by $65,000 at the beginning of the project.

What will the cash flows for this project be? (Negative amounts should be indicated by a minus sign. Round your answers to 2 decimal places.)

Year	0		1		2		3
FCF	$		$		$		$