Question

Please show all work in an Excel spreadsheet, showing all calculations in each cell.

2. Kolbys Korndogs is looking at a new sausage system with an installed cost of S625,000. This cost will be depreciated straight line to zero over the projects five-year life, at the end of which the sausage system can be scrapped for S95,000. Sales minus costs will be S183,000 per year, and the system requires an initial investment in net working capital of S41,000. If the tax rate is 34 percent, determine the projects cash flow in each year.

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