Ee 325. Dog Up! Franks is looking at a new sausage system with an installed cost of $750,000. This cost will be depreciated straight-line tozero over the project's 7-year life, at the end of which the sausage system can be scrapped for $104,000. The sausage system willsave the firm $221,000 per year in pretax operating costs, and the system requires an initial investment in net working capital of$73,000.What is the aftertax salvage value of the equipment?Note: Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32.Aftertax salvage valueOCF$What is the annual operating cash flow?Note: Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32.79,040NPVIf the tax rate is 24 percent and the discount rate is 11 percent, what is the NPV of this project?Note: Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.

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Description: Ee 325. Dog Up! Franks is looking at a new sausage system with an installed cost of $750,000. This cost will be depreciated straight-line tozero over the project's 7-year life, at the end of which the sausage system can be scrapped for $104,000. The

As per the given information: Installation cost = $750,000Project life = 7-year lifeScrap value =…

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Dog Up! Franks is looking at a new sausage system with an installed cost of $750,000. This cost will be depreciated straight-line to ero over the project's 7-year life, at the end of which the sausage system can be scrapped for $104,000. The sausage system will ave the firm $221,000 per year in pretax operating costs, and the system requires an initial investment in net working capital of -73,000. What is the aftertax salvage value of the equipment? lote: Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32. Aftertax salvage value OCF $ What is the annual operating cash flow? lote: Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32. 79,040 inv the tax rate is 24 percent and the discount rate is 11 percent, what is the NPV of this project? lote: Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.

Dog Up! Franks is looking at a new sausage system with an installed cost of $750,000. This cost will be depreciated straight-line to ero over the project's 7-year life, at the end of which the sausage system can be scrapped for $104,000. The sausage system will ave the firm $221,000 per year in pretax operating costs, and the system requires an initial investment in net working capital of -73,000. What is the aftertax salvage value of the equipment? lote: Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32. Aftertax salvage value OCF $ What is the annual operating cash flow? lote: Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32. 79,040 inv the tax rate is 24 percent and the discount rate is 11 percent, what is the NPV of this project? lote: Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.

Corporate Fin Focused Approach

5th Edition

ISBN:9781285660516

Author:EHRHARDT

Publisher:EHRHARDT

Chapter11: Cash Flow Estimation And Risk Analysis

Section: Chapter Questions

Problem 1lM

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