Reference no: EM131959192

The osseo Rink is consideing adding an additional rink to its facility. The rink would cost $229000, would be depreciated on a straightline basis over its seven years life, and would have a zero salvage value. The anticapated revenue from the project is $62500 a year with $18400 of that amount being varible cost. The fix cost would be $15700. The firm believe that it will earn an addiontional $22500 a year from its current operations should the rink be added. The project will require $3000 if net working capital, which is revoverable a the end of the priject. What is the Net Present Value on this project at a tax rate of 34 percent?