Problem $10-1$ Relevant Cash Flows $[$LO$1]$

Parker & Stone, Incorporated, is looking at setting up a new

manufacturing plant in South Park to produce garden tools. The

company bought some land six years ago for $$5\mathrm{.}6$ million in

anticipation of using it as a warehouse and distribution site, but the

company has since decided to rent these facilities from a competitor

instead. If the land were sold today, the company would net $$5\mathrm{.}9$

million. The company wants to build its new manufacturing plant on

this land; the plant will cost $$13\mathrm{.}1$ million to build, and the site requires

$$830,000$ worth of grading before it is suitable for construction. What

is the proper cash flow amount to use as the initial investment in fixed

assets when evaluating this project? $($Do not round intermediate

calculations and enter your answer in dollars, not millions of dollars,

e$.$g$.,1,234,567.$