Question: How would I solve using excel? Please provide the formulas. Majestic Theaters is considering investing in some new projection equipment whose data are shown below.

 How would I solve using excel? Please provide the formulas. Majestic

How would I solve using excel? Please provide the formulas.

Majestic Theaters is considering investing in some new projection equipment whose data are shown below. The required equipment has a 3-year tax life and would be fully depreciated by the straight-line method over the 3 years, but it would have a positive pre- tax salvage value at the end of Year 3, when the project would be closed down. Also some new working capital would be required, but it would be recovered at the end of the project's life. Revenues and other operating costs are expected to be constant over the project's 3-year life. What is the project's NPV? WACC Net investment in fixed assets (depreciable basis) Required new working capital Straight line depr'n rate Sales revenues, each vear 10.0% $65,000 $10,000 33.333% $70,000 $25,000 $5,000 35.0% Operating costs excl. depr'n, each year Expected pretax salvage value Tax rate

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