The ABC is investing in a matchine which will increase the quality of their product.
The initial investment in the machine is $800,000. The life of the machine is 4 years. The machine will be depreciated using the straight line method. The annual sales will be $400000, the annual fixed const will be $50000, and the annual variable cost will be 10% of the sales. If required rate of return is 12% and corporate tax rate is 30% what is the net present value of the project
Calculate the net present value of the Project
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Explain the effect that the timing in the receipt of.
the profits from project 1 and project 2 in Problems
5 and 6 has on the present value of the two
investment projects.
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