Paul Restaurant is considering the purchase of a $9,800 soufflé maker. The soufflé maker has an...

Paul Restaurant is considering the purchase of a $9,800 soufflé maker. The soufflé maker has an economic life of 6 years and will be fully depreciated by the straight-line method. The machine will produce 1,400 soufflés per year, with each costing $2.50 to make and priced at $4.90. The discount rate is 9 percent and the tax rate is 22 percent.

What is the NPV of the project?

Expert Solution

Please refer to below spreadsheet for calculation and answer. Cell reference also provided.

Cell reference -

jeff jeffy answered 1 year ago

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