Net present value and internal rate of return for project

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Lewis Industries looking at a project that will require a dollar 100,000 investments in fixed assets and another dollar 15,000 in net working capital, which will be recovered at the end of the project. The project is expected to produce sales of dollar 110,000 with associated costs of dollar 60,000 over its 4-year life. The company uses straight-line depreciation to a zero book value over the life of the project (there is expected to be no salvage value for the equipment). The tax rate is 40%. Lewis uses a 12% discount rate for this type of investment. What is the net present value and internal rate of return for this project?

Reference no: EM131055102

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