Considering new three-year expansion project

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Reference no: EM132028814

Quad Enterprises is considering a new three-year expansion project that requires an initial fixed asset investment of $2.81 million. The fixed asset will be depreciated straight-line to zero over its three-year tax life, after which time it will be worthless. The project is estimated to generate $2236953 in annual sales, with costs of $864593. If the tax rate is 33 percent and the required return on the project is 8 percent, what is the project's NPV?

Reference no: EM132028814

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