Question

W-Calculations Saved Help S P10-11 Calculating Project Cash Flow from Assets [LO1 Summer Tyme, Inc., is considering a new 3-year expansion project that requires an initial fixed asset investment of $3.564 million. The fixed asset will be depreciated straight-line to zero over its 3-year tax life, after which time it will have a market value (salvage value) of $277,200. The project requires an initial investment in net working capital of $396,000. The project is estimated to generate $3,168,000 in annual sales, with costs of $1,267,.200. The tax rate is 31 percent and the required return on the project is 13 percent Required: (a)What is the project's year O net cash flow (or cash flow from assets)? (Click to select) (b)What is the project's year 1 net cash flow (or cash flow from assets)? to select (c)What is the project's year 2 net cash flow (or cash flow from assets)? Click to select) (d)What is the project's year 3 net cash flow (or cash flow from assets)? (Click to select) (e)What is the NPV? Click to select) < Prev 40f 71ll Next >

Answer 1

The answer has been presented in the supporting sheets. All the parts has been solved with detailed explanation and format. For detailed answers refer to the supporting sheets.

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