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Diamond systems is purchasing equipment for $850,000. The equipment will be depreciated using the three-year MACRS...

Diamond systems is purchasing equipment for $850,000. The equipment will be depreciated using the three-year MACRS schedule and will be worth $140,000 at the end of three years. costs will be reduced 500,000 annually and net working capital can be reduced by 75,000. Diamond systems is using the 35% tax bracket & requires an 18 percent return on all projects.

What is the NPV?
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Answer #1

C3 : x fix =850000*0.3333 A B C D F G H M Depreciati on Net income Depreciati Operating on cash flows PBT Tax@35% 1 2 Cost Ye

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