Requires an investment in new equipment

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Reference no: EM13765658

Newcastle Coal Company is considering a project that requires an investment in new equipment of $3,800,000, with an additional $190,000 in shipping and installation costs. Newcastle estimates that its accounts receivable and inventories need to increase by $760,000 to support the new project, some of which is financed by a $304,000increase in spontaneous liabilities (accounts payable and accruals).

The total cost of New castle's new equipment is _________ and consists of the price of the new equipment plus the _____________.

In contrast, Newcastle's initial investment outlay is _______.

Reference no: EM13765658

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