Determine what is the present value of the projects ocfs

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Reference no: EM13336001

McDermott Technologies is evaluating a new project that requires $800,000 in new equipment. McDermott estimates that the new project will generate $900,000 in annual sales at the end of each of the next four years and that operating costs (excluding depreciation) will equal $400,000. Suppose the firm depreciates the equipment using the straight-line method over four years and the firm's tax rate is 40%. The project's WACC is 10.4%, what is the present value of te projects OCFs?

Reference no: EM13336001

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