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NPV.  Miglietti Restaurants is looking at a project with the following forecasted​ sales: ​ first-year sales...

NPV.  Miglietti Restaurants is looking at a project with the following forecasted​ sales: ​ first-year sales quantity of 36,000​, with an annual growth rate of 4.00​% over the next ten years. The sales price per unit will start at ​$45.00 and will grow at 2.00% per year. The production costs are expected to be 55​% of the current​ year's sales price. The manufacturing equipment to aid this project will have a total cost​ (including installation) of ​$2,400,000. It will be depreciated using​ MACRS, and has a​ seven-year MACRS life classification. Fixed costs will be ​$330,000 per year. Miglietti Restaurants has a tax rate of 40​%. What is the operating cash flow for this project over these ten​ years? Find the NPV of the project for Miglietti Restaurants if the manufacturing equipment can be sold for ​$140,000at the end of the​ ten-year project and the cost of capital for this project is 8​%.

What is the operating cash flow for this project in year​ 1?​ (Round to the nearest​ dollar.)

What is the operating cash flow for this project in year​ 2? ​(Round to the nearest​ dollar.)

What is the operating cash flow for this project in year​ 3? (Round to the nearest​ dollar.)

What is the operating cash flow for this project in year​ 4? (Round to the nearest​ dollar.)

What is the operating cash flow for this project in year​ 5? ​(Round to the nearest​ dollar.)

What is the operating cash flow for this project in year​ 6?​(Round to the nearest​ dollar.)

What is the operating cash flow for this project in year​ 7? ​(Round to the nearest​ dollar.)

What is the operating cash flow for this project in year​ 8? ​(Round to the nearest​ dollar.)

What is the operating cash flow for this project in year​ 9? ​(Round to the nearest​ dollar.)

What is the operating cash flow for this project in year​ 10? ​(Round to the nearest​ dollar.)

What is the​ after-tax cash flow of the project at​ disposal? (NEAREST DOLLAR)

What is the NPV of the​ project? (Nearest dollar)

Data Table: MACRS Fixed Annual Expense Percentages by Recovery Class        

  Year

​3-Year

​5-Year

​7-Year

​10-Year

    1

​33.33%

​20.00%

​14.29%

​10.00%

    2

​44.45%

​32.00%

​24.49%

​18.00%

    3

​14.81%

​19.20%

​17.49%

​14.40%

    4

​ 7.41%

​11.52%

​12.49%

​11.52%

    5

​11.52%

​8.93%

​9.22%

    6

​ 5.76%

​8.93%

​7.37%

    7

​8.93%

​6.55%

    8

​4.45%

​6.55%

    9

​6.55%

  10

​6.55%

  11

​3.28%

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Expert Solution

jeff jeffy answered 1 year ago
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