Deva.

9.56%

\ comp Services recently hired you as a consultant to help with its capital budgeting process. The used hy is considering a new project whose data are shown below. The equipment that would be would h a 3-year tax life, would be depreciated by the straight-line method over its 3-year life, and operatiave a zero salvage value. No new working capital would be required. Revenues and other Risk-adjus costs are expected to be constant over the project's 3-year life. What is the project's NPV? Net invested cost of capital\ Straight-linent cost (depreciable basis) Sales reve deprec. Rate\

=10.0%\ =$65,000\ =33.3333%\ =$65,500\ =$25,000\ =35.0%

\

Operating costs (excl. deprec.), each year =$65,500\ Tax rate =33.0333%\ a. $15,740=35.0%

\ b.

$16,569

\ c.

$17,441

\ d.

$18,359

\ e.

$19,325

60. DeVault Services recently hired you as a consultant to help with its capital budgeting process. The company is considering a new project whose data are shown below. The equipment that would be used has a 3-year tax life, would be depreciated by the straight-line method over its 3 -year life, and would have a zero Operating costs ared cost of capital to be constant over the project's 3-year life. What is the project's NPV? Risk-adjust Net invaight-line deprec. Rate Sales revenues, each year Tax rate a. $15,740 b. $16,569 c. $17,441 d. $18,359 e. $19,325