P11-6 Scenario Analysis [LO2]

We are evaluating a project that costs $741,000, has an ten-year life, and has no salvage value. Assume that depreciation is straight-line to zero over the life of the project. Sales are projected at 118,000 units per year. Price per unit is $36, variable cost per unit is $23, and fixed costs are $749,151 per year. The tax rate is 33 percent, and we require a 12 percent return on this project. The projections given for price, quantity, variable costs, and fixed costs are all accurate to within +/- 15 percent.

Required:
(a)	Calculate the best-case NPV. (Do not round your intermediate calculations.)

(b)	Calculate the worst-case NPV. (Do not round your intermediate calculations.)