Year 0 Year 1 Year 2 Year 3 Year 4 Revenue 120000 440000 440000 320000 Cost of Goods Sold 60000 220000 220000 160000 Gross Profit 60000 220000 220000 160000 Selling, General and Admin 6400 6400 6400 6400 Depreciation 80000 80000 80000 80000 EBIT 26400 133600 133600 73600 Income tax (35 ) 9240 46760 46760 25760 Incremental Earnings 35640 86840 86840 47840 Capital Purchaes 280,000 Change to NWC 5,000 5,000 5,000 5,000 A garage is installing a new bubble wash car wash It will promote the car wash as a fun activity for the family, and it is expected that the novelty of this approach will boost sales in the medium term If the cost of capital is 10 , by using the data in the table above, calculate the net present value (NPV) of this project A $126,727 B $120,391 C $114,054 D $ 139,400

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Question: Year 0 Year 1 Year 2 Year 3 Year 4 Revenue 120000 440000 440000 320000 Cost of Goods Sold -60000 -220000 -220000 160000 Gross Profit

Year 0	Year 1	Year 2	Year 3	Year 4
Revenue		120000	440000	440000	320000
Cost of Goods Sold		-60000	-220000	-220000	160000
Gross Profit		60000	220000	220000	160000
Selling, General and Admin		-6400	-6400	-6400	-6400
Depreciation		-80000	-80000	-80000	-80000
EBIT		-26400	133600	133600	73600
Income tax (35%)		9240	-46760	-46760	-25760
Incremental Earnings		-35640	86840	86840	47840

Capital Purchaes	-280,000
Change to NWC		-5,000	-5,000	-5,000	-5,000

A garage is installing a new "bubble-wash" car wash. It will promote the car wash as a fun activity for the family, and it is expected that the novelty of this approach will boost sales in the medium term. If the cost of capital is 10%, by using the data in the table above, calculate the net present value (NPV) of this project

A. $126,727

B. $120,391

C. $114,054

D.$ 139,400

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