Today ABC Corp. starts a project that requires it to invest in new equipment of $990,000. Doing so will earn ABC pre-tax cash flows of $142,000 annually over 9 years. The equipment has a salvage value of $187,000. ABC's cost of capital is 6.30%, and its tax rate is 30%. The equipment falls into the 30% CCA class (half year rule applie
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Today ABC Corp. starts a project that requires it to invest in new equipment of $990,000. Doing so will earn ABC pre-tax cash flows of $142,000 annually over 9 years. The equipment has a salvage value of $187,000. ABC's cost of capital is 6.30%, and its tax rate is 30%. The equipment falls into the 30% CCA class (half year rule applies). What is the NPV of the project? PLEASE USE FINANCIAL CALCULATOR OR FORMULA NO EXCEL OR SPREADSHEETS THE ANSWER IS NOT CHOICE B
a.
$23,434
b.
$211,428
c.
-$3,319
d.
-$214,747
e.
-$111,224
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