Question: please help me with this question its due tonight please!!! Afer spending $10,700 on clent-develogment, you have just been otlered a big production contract by


Afer spending $10,700 on clent-develogment, you have just been otlered a big production contract by a new cient. The contract wil add $209,000 to your revenues for esch of the next five years could be sold for $49,000 now. if you use it in the project, it wit be worthiess at the end of the project You will buy new equipment valued at $31,000 and use the 5 -year Macks schedule to deprecale it it wil be worthless at the end of the project. Your current production manager earns $45,000 per year. Since she is busy with ongoing projects, you ate planning to hire an assistact at: $38,000 per year to help with the expansion. You will have to imenedistely increase your imventory from $20,000 to $30,000. It will retum to $20,000 at the end of the project. Your companys tax rate is 215 and your discount rate is 15.2%. What is the NPV of the contract? (Nofe: Assume that the equipment is put into use in yoar i.) Calculate the free cash flows below for vears 0 throuah 2: (Round to the nearest dollar.) Calculate the free cash flows below for years 3 through 6 : The NPV of the project is $ (Round to the nearest dollar.)
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