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What is the npv

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Question - If Lew's Steel Forms purchases $630,000 of new equipment, they can lower annual operating costs by $295,000. The equipment will be depreciated straight-line to a zero book value over its 3-year life. Ignore bonus depreciation. At the end of the three years, the equipment will be sold for an estimated $30,000. The equipment will require the company to hold an extra $59,000 of inventory over the 3-year period. What is the NPV if the discount rate is 12 percent and the tax rate is 21 percent?

Reference no: EM133158509

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