A Project Has an Initial Requirement of $ 260,000 for Fixed

question 41

Multiple Choice

A project has an initial requirement of $ 260,000 for fixed assets and $16,500 for net working capital.The fixed assets will be depreciated to a zero book value over the four-year life of the project and have an estimated salvage value of $50,000.All of the net working capital will be recouped at the end of the project.The annual operating cash flow is $82,500 and the discount rate is 12 percent.What is the project's net present value if the tax rate is 21 percent?

• A)$15,684.29
• B)$12,345,34
• C)$9,670.33
• D)-$15.432.63
• E)$16,343.27

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