What is the projects year 0 net cash flow

Reference no: EM13260786

Down Under Boomerang, Inc., is considering a new three-year expansion project that requires an initial fixed asset investment of $1.4 million. The fixed asset will be depreciated straight-line to zero over its three year tax life, after which it will be worthless. The project is estimated to generate $1,120,000 in annual sales, with costs of $480,000. The tax rate is 35 percent and the required return is 12 percent. The project requires an initial investment in net working capital of $285,000 and the fixed asset will have a market value of $225,000 at the end of the project. What is the project's Year 0 net cash flow?

Reference no: EM13260786

Questions Cloud

The FBI has released-most wanted cybercriminals : The FBI has released the identities of the top five most wanted cybercriminals. None of the subjects who are wanted reside in the U.S. What steps should the FBI take to arrest these subjects?

Explain muscle tissue and is responsible for muscle soreness : During physical activity, lactic acid (MM = 90.08 g/mole) forms in muscle tissue and is responsible for muscle soreness. An elemental analysis shows that it contains 40.0 mass percent C, 6.71 mass percent H

Believe the actions of the FBI were legal : Based on the Alexey Ivanov and Vasiliy Gorshkov case, do you believe the actions of the FBI were legal? How would you have handled the situation differently?

What is the number of loops in the secondary : A portable x-ray unit has a step-up transsformer, the 120 V input of which is transformed to the 100kV output needed by the x-ray tubr, what is the number of loops in the secondary

What is the projects year 0 net cash flow : The project requires an initial investment in net working capital of $285,000 and the fixed asset will have a market value of $225,000 at the end of the project. What is the project's Year 0 net cash flow?

Statements about productivity : Which of the following statements about productivity is false?

Explain solutions in order of increasing boiling point : List the following aqueous solutions in order of increasing boiling point: 0.121 m C6H12O6 (glucose), 0.042 m LiBr, 0.052 m Zn(NO3)2

Determine the amount of force used to lift the ship : A starship has a mass of 8,500kg. It is moved by Yoda, 3.2m vertically upward and 14.8m horizontally toward Yoda, Determine the amount of force used to lift the ship

How organizations compete for resources : how organizations compete for resources, the consequences and costs of obtaining resources, and how resource attachment varies with the type of organization

User Account

All Pages