Assume there is no need for additional investment in building the land for the project. The firms marginal tax rate is 35%, and its cost of capital is 10%.
To receive full credit on this assignment please show all work including formulas and calculations used to arrive at financial values
Using the information in the assignment description:
Prepare a statement showing the incremental cash flows for this project over an 8 year period.
Calculate the payback period (P/B) and the net present value (NPV) for the project
A double spaced word document of 2-3 pages that contains your calculation values, your complete calculations, any formulas that you used.
?Do you think the project should be accepted? Why?
?Assume the company has a P/B (payback) policy of not accepting projects with life of over 3 years.
If the project required additional investment in land and building, how would this affect your decision? Explain.
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