I WILL THUMBS UP PLEASE ANSWER

Assume everything is given in n=0, CONSTANT dollars unless otherwise stated:

Hartsfield Company is considering purchasing a set of machine tools at a cost of $90,000. The purchase is expected to generate revenues of $32,000. The purchase of the tools will also lead to higher operating costs of $9,000 per year in each of the next three years.Additional profits will be taxed at a rate of 40%. The asset falls into CCA Class 45 (rate = 30%) for tax purposes and the 50% rule applies. The project has a three-year life. Theconstant-dollarmarket (re-sale) value of the machine tools is expected to fall by 30% annually. The company will require a working capital of $5,000 to bemaintained in purchasing powerover the lifetime of the project and can be recovered at the time of the project's completion.

The general inflation rate is 5% per year (and affects everything that it normally affects).Assume aMARR' =7%.

(Remember to round up/down to whole dollar figures for EVERY entry in the income statement and cash flow statement. Solutions are also rounded to the nearest dollar.Note: .5 rounds up)

The NPW of the project of the project is within $50 of

Question 13 options:

-6036

-11622

-8471

-13025

-6819

None of the above