Capstone Quarry is analyzing whether a new contract proposal will be a good idea. The relevant data is shown below. The net working capital will be paid in the same time period as the cost of the equipment and will be recovered at the end of the project. Remember to calculate the after-tax gain or loss of salvage as part of your terminal cash flow.

Capstone Quarry is analyzing whether a new contract proposal will be a good idea. The relevant data is shown below. The net working capital will be paid in the same time period as the cost of the equipment and will be recovered at the end of the project. Remember to calculate the after-tax gain or loss of salvage as part of your terminal cash flow.

Find the following:

1. MIRR

2. PI

Capstone Quarry Company Contract Analysis 25,000 Tons 135 $ 1,500,000 Amount of Rock Salt per Year Revenue per Ton Cost of Equipment Life MACRS Class Fixed Cost per year Var Cost/Ton Actual Salvage Change in NWC Required Return Tax Rate $ 370,000 95 $ 100,000 $ 90,000 11% 35%