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A company plans to invest in a new manufacturing project over the next 12 years. The...

A company plans to invest in a new manufacturing project over the next 12 years. The project will require an initial investment of $65,000, and an additional investment of $26,000 in Year 5. Starting in Year 2, the company will reduce their labour costs by $14,500 a year for the next 5 years, and $9000 a year for the next 4 years. At the end of the project, there will be a residual value of $24,000. If the company’s cost of capital is 11%, calculate the net present value for this project, and determine if the project was profitable for the company.  (Show ALL Cash Flow entries in the table provided. Justify your answer.)

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jeff jeffy answered 1 year ago
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