Considering new three-year expansion project

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Quad Enterprises is considering a new three-year expansion project that requires an initial fixed asset investment of $2.63 million. The fixed asset will be depreciated straight-line to zero over its three-year tax life and is estimated to have a market value of $265695 at the end of the project. The project is estimated to generate $2239033 in annual sales, with costs of $891117. The project requires an initial investment in net working capital of $379762. If the tax rate is 35 percent and the required return on the project is 10 percent, what is the project's NPV?

Reference no: EM132028821

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