Requires initial fixed asset investment

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Reference no: EM131541001

Summer Tyme, Inc., is considering a new 3-year expansion project that requires an initial fixed asset investment of $5.616 million. The fixed asset will be depreciated straight-line to zero over its 3-year tax life, after which time it will have a market value of $436, 800. The project requires an initial investment in net working capital of $624,000. The project is estimated to generate $4, 992,000 in annual sales, with costs of $1, 996, 800. The tax rate is 33 percent and the required return on the project is 10 percent. The NPV for this project is $ (Do not include the dollar sign ($). Negative amount should be indicated by a minus sign. Round your answer to 2 decimal places. (e.g., 32.16)).

Reference no: EM131541001

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