Question
You have been asked to review some old accounting records from a predecessor. In one specific 9 year project, the Year 0 capital cost and
You have been asked to review some old accounting records from a predecessor. In one specific 9 year project, the Year 0 capital cost and the annual operating costs were notably missing from the records. Other data, however, showed that the project would produce annual revenue of $41,843 per year in years 1 through 9, and the annual operating costs were estimated to be 10% of the capital cost. The records list the project NPV as $28,621 at a discount rate of 8%. Based on this information, what is the capital cost for this project?
Express your answer as a positive value.
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