Log in
Finance
2
answers
0
watching
11
views

Cost $138,000

Straight-line dep.

5-year life

0 salvage value

Estimated income = $72,000 a year

$24,000 of that = variable cost

Fixed cost = $11,600

Anticipates additional $14,000 in revenue from existing facilities

Requires $3,000 of NWC (recoverable @ end of project)

12% discount rate

34% tax rate

What is NPV?

Watch
2
answers
0
watching
11
views

For unlimited access to Homework Help, a Homework+ subscription is required.

Unlock all answers

Get 1 free homework help answer.
Get unlimited access
Already have an account? Log in
Share
Reid Wolff
Reid WolffLv2
19 Aug 2019
Get unlimited access
Already have an account? Log in
Share

Related questions

SQLite Sports is considering adding a miniature golf course to its facility. The course would cost $136,924, would be depreciated on a straight line basis over its 5-year life, and would have a zero salvage value. The estimated income from the golfing fees would be $74,894 a year with $26,722 of that amount being variable cost. The fixed cost would be $11,483. In addition, the firm anticipates an additional $14,982 in revenue from its existing facilities if the golf course is added. The project will require $3,836 of net working capital, which is recoverable at the end of the project. What is the net present value of this project at a discount rate of 11.3 percent and a tax rate of 34 percent?

SQLite Sports is considering adding a miniature golf course to its facility. The course would cost $132,739, would be depreciated on a straight line basis over its 5-year life, and would have a zero salvage value. The estimated income from the golfing fees would be $77,403 a year with $22,957 of that amount being variable cost. The fixed cost would be $11,048. In addition, the firm anticipates an additional $14,648 in revenue from its existing facilities if the golf course is added. The project will require $4,061 of net working capital, which is recoverable at the end of the project. What is the net present value of this project at a discount rate of 9.4 percent and a tax rate of 34 percent?

SQLite Sports is considering adding a miniature golf course to its facility. The course would cost $135,673, would be depreciated on a straight line basis over its 5-year life, and would have a zero salvage value. The estimated income from the golfing fees would be $71,897 a year with $22,564 of that amount being variable cost. The fixed cost would be $10,291. In addition, the firm anticipates an additional $14,652 in revenue from its existing facilities if the golf course is added. The project will require $3,232 of net working capital, which is recoverable at the end of the project. What is the net present value of this project at a discount rate of 9.6 percent and a tax rate of 36 percent?

Weekly leaderboard

Home
Homework Help 3,900,000
Finance 370,000
Start filling in the gaps now
Log in