4 and 5

QUESTION 4 Atlas Corp. is considering two mutually exclusive projects. Both require an initial investment of S9,900 at 1-0. Project S has an expected life of 2 years with after-tax cash inflows of $6.700 and $7,500 at the end of Years I and 2 respectively. Project L has an expected life of 4 years with after-tax cash inflows of $4.110 at the end of each of the next 4 years. Each project has a WACC of 9.25%, and Project S can be repeated with no changes in its cash flows. The controller prefers Projects, but the CFO prefers Project L. How much value will the firm gain or lose if Project L is selected over Project Sie, what is the value of NPV LNPVS? O2-S1.320.80 ObS1.307.98 Oc51.166.92 Od 51,025.87 O.-51.282.33 2 poir QUESTIONS Liberty Services is now at the end of the final year of a project. The equipment was purchased prior to the new tax law and originally cost $20.000, of which 75% has been depreciated. The firm can sell the used equipment today for $6,000, and its tax rate is 25%. What is the equipment's after-tax salvage value for use in a capital budgeting analysis? Note that if the equipment's final market value is less than its book value, the fim will receive a tax credit as a result of the sale that will offset income from the company's other projects. a 54214 Ob 55,750 OC.55.145 Od $4.263 De $4.998