Quad Enterprises is considering a new three-year expansion project that requires an initial fixed asset investment of $2.9 million. The fixed asset will be depreciated straight-line to zero over its three-year tax life. The project is estimated to generate $2,190,000 in annual sales, with costs of $815,000. The project requires an initial investment in net working capital of $300,000, and the fixed asset will have a market value of $210,000 at the end of the project.

What is the projects Year 0 net cash flow? Year 1? Year 2? Year 3? The tax rate is 21 percent.

If the required return is 12 percent, what is the project's NPV?

YOU MUST SHOW FORMULAS IN EACH CELL.

Aftertax salvage value

Asset investment	2900000
Estimated annual sales	2190000
Costs	815000
Net working capital	300000
Pretax salvage value	210000
Tax rate	21%
Project and asset life	3
Required return	12%
Sell Equiptment
Taxes
Aftertax cash flow
Sales	2,190,00	2,190,00	2,190,00
Costs	815000	815000	815000
Depreciation
EBT
Taxes
Net Income
Capital Spending
Networking Capital
OCF
Net cash flow
NPV