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What is the npv of the project

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Reference no: EM132681544

A pizza restaurant is considering whether to install a new pizza oven with an installed cost of $300,000. It will be depreciated straight-line to zero over the project's four-year life, at the end of which it will have a scrap value of $50,000. The oven will improve annual operating cash flows by $80,000 but will require an initial working capital investment of $30,000, which will be recouped at the end of the project. What is the NPV of the project, if the restaurant pays tax 30% and the required rate of return for the project is 8% p.a.?

Reference no: EM132681544

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