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Net Present Value of a Depreciable Asset

Dog Up! Franks is looking at a new sausage system with an installed cost of $490,000. 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 $72,000. The sausage system will save the firm $170,000 per year in pre-tax operating costs, and the system requires an initial investment in net working capital of $31,000. If the tax rate is 30 percent and the discount rate is 8 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))

NPV $

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Franks is looking at a new sausage system with an installed cost of $490,000. This cost will be depreciated straight-line to zero over the project's ...

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Solution helps in estimating Net Present Value of a Depreciable Asset

$2.19