Example: Project XY T= Project XY requires an investment of $1,000 and generates annual revenues of...

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Example: Project XY T= Project XY requires an investment of $1,000 and generates annual revenues of $600 and Starting UCC CCA Rate annual Depreciation Expense Initial Investment YEAR Revenues expenses of $300. The CCA rate is Ending UCC 0.25. All cash flows occur at year end. The project will last for 5 years, at which time the machinery Operating Costs will be useless. The firm's tax rate is Depreciation EBIT 36%. If the firm's cost of capital is Less: Taxes 10%, what is the project's NPV? NOPAT (+) Depreciation OCF SV PVCCATS TOTAL CF 27 Discount. CF NPV Depreciation Schedule PROJECT XY 2 3 4 5 0 1 2 3 4 5 Example: Project XY T= Project XY requires an investment of $1,000 and generates annual revenues of $600 and Starting UCC CCA Rate annual Depreciation Expense Initial Investment YEAR Revenues expenses of $300. The CCA rate is Ending UCC 0.25. All cash flows occur at year end. The project will last for 5 years, at which time the machinery Operating Costs will be useless. The firm's tax rate is Depreciation EBIT 36%. If the firm's cost of capital is Less: Taxes 10%, what is the project's NPV? NOPAT (+) Depreciation OCF SV PVCCATS TOTAL CF 27 Discount. CF NPV Depreciation Schedule PROJECT XY 2 3 4 5 0 1 2 3 4 5