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(Answered) finance


Summer Tyme, Inc., is considering a new 3-year expansion project that requires an initial fixed asset investment of $3.672 million. The fixed asset will be depreciated straight-line to zero over its 3-year tax life, after which time it will have a market value of $285,600. The project requires an initial investment in net working capital of $408,000. The project is estimated to generate $3,264,000 in annual sales, with costs of $1,305,600. The tax rate is 31 percent and the required return on the project is 16 percent. Required: Required: (a) What is the project's year 0 net cash flow? (Click to select) -4,284,000 -3,876,000 -4,080,000 -4,488,000 -3,672,000 (b) What is the project's year 1 net cash flow? (Click to select) 1,557,662 1,644,199 1,730,736 1,903,810 1,817,273 (c) What is the project's year 2 net cash flow? (Click to select) 1,817,273 1,730,736 1,557,662 1,644,199 1,903,810 (d) What is the project's year 3 net cash flow? (Click to select) 2,452,590 2,335,800 2,219,010 2,569,380 2,102,220 (e) What is the NPV? (Click to select) 194,681 1,573,323 204,415 -673,293 215,042 rev: 09_18_2012
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