What is the npv of project

Assignment Help Finance Basics
Reference no: EM132049270

Your company is considering a 4-year expansion project that requires an initial fixed asset investment of $157,000. The fixed asset will be depreciated straight-line to zero over its 4-year life. The project is estimated to generate $150,000 in annual sales, with costs of $52,000. The project requires an initial investment in net working capital of $15,000, and the fixed asset will be sold for $13,000 at the end of the project. The tax rate is 25%, and the required return is 11%. What is the NPV of this project?

Round your answer to the nearest dollar, for example 10789.

Reference no: EM132049270

Questions Cloud

How much interest is paid in the first year : A couple has just purchased a home for $348,400.00. How much interest is paid in the first year?
What is the net present value of project : Your estimated cost of capital is 11%. What is the net present value of this project?
What is the first net payment under the swap : The notional principal on the swap is $10 million. What is the first net payment under the swap if LIBOR is 7%?
What is the amount of operating cash flow : If the tax rate is 27%, what is the amount of operating cash flow (OCF) each year? Answer to the nearest dollar, for example 102.
What is the npv of project : The tax rate is 25%, and the required return is 11%. What is the NPV of this project?
What is the monthly payment on the loan : The mortgage has a term of 30 years. What is the monthly payment on the loan?
How does net working capital affect the npv : How does net working capital affect the NPV of a 8-year project if working capital is expected to increase by $14,000 and the project
What are 3 commercial insurance programs : What are 3 commercial insurance programs? Can you tell me how to bill for each program?
What is the expected payoff to the stock : A stock DEF has the following payoffs probabilities: What is the Expected Payoff to the stock?

Reviews

Write a Review

Finance Basics Questions & Answers

  Financial reporting and analysis

Finance is about Gunns Ltd, a company in dealing with forestry products in Australia. The company has also been listed in Australian Stock Exchange. As many companies producing forestry products, even Gunns Ltd is facing various problems. Due to the ..

  A report on financial accounting

This report is specific for a core understanding for Financial Accounting and its relevant factors.

  Describe the types of financial ratios

Describe the types of financial ratios and other financial performance measures that are used during venture's successful life cycle.

  Differences between sole proprietorship and corporation

Briefly describe the major differences between a sole proprietorship and a corporation

  Prepare a cash budget statement

Calculate the expected value of the apartment in 20 years' time. What is the mortgage loan repayment at the beginning of each month

  What are the implied interest rates

What are the implied interest rates in Europe and the U.S.?

  State pricing theory and no-arbitrage pricing theory

State pricing theory and no-arbitrage pricing theory

  Small business administration

Identify the likely stage for each venture and describe the type of financing each venture is likely to be seeking and identify potential sources for that financing.

  Effect of financial leverage

The Effect of Financial Leverage and working capital management

  Evaluate the basis for the payment to the lender

Evaluate the basis for the payment to the lender and basis for the payment to the company-counterparty.

  Importance of opps, ipps, mpfs and dmepos

Research and discuss the differences and importance of : OPPS, IPPS, MPFS and DMEPOS.

  Time value of money

Time Value of Money project

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd