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Temple Corp. is considering a new project whose data are shown below. The equipment that would...

Temple Corp. is considering a new project whose data are shown below. The equipment that would be used has a 3-year tax life, would be depreciated by the straight-line method over its 3-year life, and would have a zero salvage value. No change in net operating working capital would be required. Revenues and other operating costs are expected to be constant over the project's 3-year life. What is the project's NPV? Do not round the intermediate calculations and round the final answer to the nearest whole number.

Risk-adjusted WACC 10.0%

Net investment cost (depreciable basis) $65,000

Straight-line depr. rate 33.3333%

Sales revenues, each year $63,000

Annual operating costs (excl. depr.) $25,000

Tax rate 35.0%

a. $17,729 b. $18,340 c. $14,825 d. $12,838 e. $15,283

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jeff jeffy answered 2 years ago
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