Rucci inc is considering a project that would require an

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Reference no: EM13484141 , Length: 10

Rucci Inc. is considering a project that would require an initial investment of $462,000 and would have a useful life of 7 years. The annual cash receipts would be $300,000 and the annual cash expenses would be $120,000. The salvage value of the assets used in the project would be $69,000. The company's tax rate is 30%. For tax purposes, the entire initial investment without any reduction for salvage value will be depreciated over 5 years. The company uses a discount rate of 18%.

Required:

Compute the net present value of the project

Reference no: EM13484141

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