Dog Up! Franks is looking at a new sausage system with an installed cost of $374, 400. This cost will be depreciated straight-line to zero over the project's 8- year life, at the end of which the sausage system can be scrapped for $57,600. The sausage system will save the firm $115,200 per year in pretax operating costs, and the system requires an initial investment in net working capital of $26, 880. If the tax rate is 22 percent and the discount rate is 9 percent, what is the NPV of this project? Multiple Choice $198, 535.28 $179,923.20 $202, 471.05 $189,081.22 $166,533.37

Dog Up! Franks is looking at a new sausage system with an installed cost of $374, 400. This cost will be depreciated straight-line to zero over the project's 8- year life, at the end of which the sausage system can be scrapped for $57,600. The sausage system will save the firm $115,200 per year in pretax operating costs, and the system requires an initial investment in net working capital of $26, 880. If the tax rate is 22 percent and the discount rate is 9 percent, what is the NPV of this project? Multiple Choice $198, 535.28 $179,923.20 $202, 471.05 $189,081.22 $166,533.37

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Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter19: Capital Investment

Section: Chapter Questions

Problem 4CE: Manzer Enterprises is considering two independent investments: A new automated materials handling...

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