Question: ONLY NEED NUMBER 10 ! Both questions here for context. NEED 11 TOO Calculating Project OCF H. Cochran, Inc., is considering a new three-year expansion
Calculating Project OCF H. Cochran, Inc., is considering a new three-year expansion project that requires an initial fixed asset investment of $2.15 million. The fixed asset will be depreciated straight-line to zero over its three- year tax life, after which time it will be worthless. The project is estimated to generate $2.23 million in annual sales, with costs of $1.25 million. If the tax rate is 23 percent, what is the OCF for this project? Calculating Project NPV In the previous problem, suppose the required return on the project is 14 percent. What is the project's NPV? 2 10 LO 2 94 Calculating Project OCF H. Cochran, Inc., is considering a new three-year expansion project that requires an initial fixed asset investment of $2.15 million. The fixed asset will be depreciated straight-line to zero over its three- year tax life, after which time it will be worthless. The project is estimated to generate $2.23 million in annual sales, with costs of $1.25 million. If the tax rate is 23 percent, what is the OCF for this project? LO 2 10/Calculating Project NPV In the previous problem, suppose the required return on the project is 14 percent. What is the project's NPV? LO 2 11. Calculating Project Cash Flow from Assets In the previous problem, suppose the project requires an initial investment in net working capital of $150,000, and the fixed asset will have a market value of $185,000 at the end of the project. What is the project's Year 0 net cash flow? Year 12 Year 2? Year 3? What is the new NPV
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