Question: A new 5-year project will require $194,000 for fixed assets, $58,000 for inventory, and $42,000 for accounts receivable. Short-term debt is expected to increase by

A new 5-year project will require $194,000 for fixed assets, $58,000 for inventory, and $42,000 for accounts receivable. Short-term debt is expected to increase by $46,000. The fixed assets will be depreciated straight-line to zero over the projects life and have an expected after-tax salvage value of $2,900. The net working capital returns to its original level at the end of the project. The tax rate is 34 percent, and the required return is 13 percent. What is the cash flow recovery from net working capital at the end of this project?

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