What will the cash flows for this project be

Assignment Help Financial Management

Reference no: EM131606445

You are evaluating a project for The Ultimate recreational tennis racket, guaranteed to correct that wimpy backhand. You estimate the sales price of The Ultimate to be $330 per unit and sales volume to be 1,000 units in year 1; 1,250 units in year 2; and 1,325 units in year 3. The project has a 3-year life. Variable costs amount to $190 per unit and fixed costs are $100,000 per year. The project requires an initial investment of $144,000 in assets, which will be depreciated on a straight-line basis with a life of 3 years. The actual market value of these assets at the end of year 3 is expected to be $28,000. NWC requirements at the beginning of each year will be approximately 25 percent of the projected sales during the coming year. The tax rate is 30 percent and the required return on the project is 12 percent. (Use SL depreciation table)

What will the cash flows for this project be? (Negative amounts should be indicated by a minus sign. Do not round intermediate calculations and round your answers to 2 decimal places.)

Reference no: EM131606445

Questions Cloud

How many dolphin boats are stored at both marinas : How many Dolphin 25 boats are stored at both marinas?

Define the stability of the international system : That the United States should reduce its role in world affairs in order to enhance the stability of the international system

What''s the standard deviation of the estimated returns : What's the standard deviation of the estimated returns?

The nonexperimental quantitative study : The nonexperimental quantitative study I chose looks at the relationship between mental health diagnoses in children and the behaviors of their parents.

What will the cash flows for this project be : You are evaluating project for The Ultimate recreational tennis racket, guaranteed to correct that wimpy backhand. What will the cash flows for this project be.

Timing of labor legislation in america : Why do you think the timing of labor legislation in America (beginning with the Railway Labor Act and National Labor Relations Act, and working forward).

List the slip id the description and the status : For every service request for routine engine maintenance, list the slip ID, the description, and the status.

Financing of the healthcare system : The financing of the healthcare system in the United States has been a subject of great debate and discussion.

Compute basic earnings per share : Online Network Inc. has a net income of $580,000 in the current fiscal year. Compute basic earnings per share.

User Account

All Pages