Question

Dog Up! Franks is looking at a new sausage system with an
installed cost of $455,000. This cost will be depreciated
straight-line to zero over the project’s five-year life, at the end
of which the sausage system can be scrapped for $65,000. The
sausage system will save the firm $235,000 per year in pretax
operating costs, and the system requires an initial investment in
net working capital of $24,000. If the tax rate is 34 percent and
the discount rate is 10 percent, what is the NPV of this project?
**(Do not round intermediate calculations and round your
final answer to 2 decimal places. (e.g., 32.16))**

Answer #1

Dog Up! Franks is looking at a new sausage system with an
installed cost of $510,000. This cost will be depreciated
straight-line to zero over the project’s five-year life, at the end
of which the sausage system can be scrapped for $76,000. The
sausage system will save the firm $190,000 per year in pretax
operating costs, and the system requires an initial investment in
net working capital of $35,000. If the tax rate is 34 percent and
the discount rate...

Dog Up! Franks is looking at a new sausage system with an
installed cost of $435,000. This cost will be depreciated
straight-line to zero over the project’s five-year life, at the end
of which the sausage system can be scrapped for $49,000. The
sausage system will save the firm $137,000 per year in pretax
operating costs, and the system requires an initial investment in
net working capital of $24,000. If the tax rate is 21 percent and
the discount rate...

Dog Up! Franks is looking at a new sausage system with an
installed cost of $460,000. This cost will be depreciated
straight-line to zero over the project’s five-year life, at the end
of which the sausage system can be scrapped for $55,000. The
sausage system will save the firm $155,000 per year in pretax
operating costs, and the system requires an initial investment in
net working capital of $29,000. If the tax rate is 21 percent and
the discount rate...

Dog Up! Franks is looking at a new sausage system with an
installed cost of $510,000. This cost will be depreciated
straight-line to zero over the project’s five-year life, at the end
of which the sausage system can be scrapped for $79,000. The
sausage system will save the firm $152,000 per year in pretax
operating costs, and the system requires an initial investment in
net working capital of $31,500. If the tax rate is 21 percent and
the discount rate...

Dog Up! Franks is looking at a new sausage system with an
installed cost of $450,000. This cost will be depreciated
straight-line to zero over the project’s five-year life, at the end
of which the sausage system can be scrapped for $55,000. The
sausage system will save the firm $140,000 per year in pretax
operating costs, and the system requires an initial investment in
net working capital of $25,500. If the tax rate is 24 percent and
the discount rate...

Dog Up! Franks is looking at a new sausage system with an
installed cost of $470,000. This cost will be depreciated
straight-line to zero over the project’s five-year life, at the end
of which the sausage system can be scrapped for $63,000. The
sausage system will save the firm $144,000 per year in pretax
operating costs, and the system requires an initial investment in
net working capital of $27,500. If the tax rate is 23 percent and
the discount rate...

Dog Up! Franks is looking at a new sausage system with an
installed cost of $410,000. This cost will be depreciated
straight-line to zero over the project’s five-year life, at the end
of which the sausage system can be scrapped for $70,000. The
sausage system will save the firm $115,000 per year in pretax
operating costs, and the system requires an initial investment in
new working capital of $15,000. If the tax rate is 34% and the
discount rate is...

Dog Up! Franks is looking at a new sausage system with an
installed cost of $410,000. This cost will be depreciated
straight-line to zero over the project’s five-year life, at the end
of which the sausage system can be scrapped for $70,000. The
sausage system will save the firm $115,000 per year in pretax
operating costs, and the system requires an initial investment in
new working capital of $15,000. If the tax rate is 34% and the
discount rate is...

Dog Up! Franks is looking at a new sausage system with an
installed cost of $509342. This cost will be depreciated
straight-line to zero over the project's five-year life, at the end
of which the sausage system can be scrapped for $77477. The sausage
system will save the firm $178254 per year in pretax operating
costs, and the system requires an initial investment in net working
capital of $35816. If the tax rate is 34 percent and the discount
rate...

Dog Up! Franks is looking at a new sausage system with an
installed cost of $475,000. The fixed asset will qualify for 100
percent bonus depreciation. In five years, the sausage system can
be scrapped for $65,000. The sausage system will save the firm
$145,000 per year in pretax operating costs, and the system
requires an initial investment in net working capital of $28,000.
If the tax rate is 24 percent and the discount rate is 12 percent,
what is...

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