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What is the npv of the project for fast food company

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Problem 1: A fast food company is considering whether to open a new shop. The project has an initial requirement of $261,000 for fixed assets and $27,000 for net working capital. The fixed assets will be depreciated to zero over the four-year life of the project and will have a salvage value of $78,000 at the end of the project's life. The annual operating cash flow for the project is estimated to be $96,200. What is the NPV of the project, if the tax rate is 30% and the required rate of return is 13% p.a.?

Reference no: EM132684421

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