New sausage system with an installed cost

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Reference no: EM131896884

Dog Up! Franks is looking at a new sausage system with an installed cost of $505099. This cost will be depreciated straight-line to zero over the project's five-year life, at the end of which the sausage system can be scrapped for $79554. The sausage system will save the firm $208842 per year in pretax operating costs, and the system requires an initial investment in net working capital of $30897. If the tax rate is 35 percent and the discount rate is 10 percent, what is the NPV of this project? (Do not round intermediate calculations and round your final answer to the nearest dollar amount. Omit the "$" sign and commas in your response. For example, $123,456.78 should be entered as 123457.)

Reference no: EM131896884

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