Your company is developing a new textbook for FIN 301 and you paid your current FIN 301 instructor $700,000

for his input about the feasibility of such a product.

The project would involve initial capital investment of $1,300,000

and installation costs related to the capital expenditures of $500,000.

The project would also necessitate an increase in net working capital of $300,000

at the beginning of the project.

You can straight line depreciate any depreciable expenses to zero over the three-year life of the project, and you dont expect the capital investment to be sold at the end of the project.

Each year, you estimate you will receive $3,000,000 in sales revenue from your awesome textbook. Variable product and selling costs associated with these sales are expected to be 30%

of revenue in each of those years. The fixed costs in each of the three years of the project will be $500,000.

The corporate tax rate is 40%.

Calculate the total year 0 cash flows associated with the project.

Calculate the year 1 EBIT.

Calculate the TOTAL year 1 cash flows associated with the project.

Calculate the TOTAL year 3 cash flows associated with the project.

Your company is developing a new textbook for FIN 301 and you paid your current FIN 301 instructor $700,000 for his input about the feasibility of such a product The project would involve initial capital investment of S1,300,000 and installation costs related to the capital expenditures of $500,000. The project would also necessitate an increase in net working capital of $300.000 at the beginning of the project You can straight line depreciate any depreciable expenses to zero over the three-year life of the project, and you don't expect the capital investment to be sold at the end of the project Each year, you estimate you will receive $3,000,000 in sales revenue from your awesome textbook. Variable product and selling costs associated with these sales are expected to be 30% of revenue in each of those years. The fixed costs in each of the three years of the project will be $500,000. The corporate tax rate is 40%. Calculate the total year 0 cash flows associated with the project Calculate the year 1 EBIT Calculate the TOTAL year 1 cash flows associated with the project. Calculate the TOTAL year 3 cash flows associated with the project