Question: Please solve this as soon as possible A project can sell 80,000 units per year for 4 years only. Each unit will sell for $5,
Please solve this as soon as possible
A project can sell 80,000 units per year for 4 years only. Each unit will sell for $5, with variable costs of $3 per unit. Total annual fixed costs will be $70,000. In addition, there will be a $250,000 initial cost for the new equipment which will be depreciated using the SL method down to zero after 4 years. This project will also require a one-time initial investment of $30,000 in net working capital. Assume 10% discount rate and 21% tax rate. What is the projects FCF each year?
Step by Step Solution
There are 3 Steps involved in it
Get step-by-step solutions from verified subject matter experts
