What is the NPV of this project

Reference no: EM132210847

Question - Franks is looking at a new sausage system with an installed cost of $511025. This cost will be depreciated straight-line to zero over the project's five-year life, at the end of which the sausage system can be scrapped for $77644. The sausage system will save the firm $193526 per year in pretax operating costs, and the system requires an initial investment in net working capital of $32639. If the tax rate is 32 percent and the discount rate is 12 percent, what is the NPV of this project?

Reference no: EM132210847

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