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Business, 12.07.2021 20:20 ha328

The Best Manufacturing Company is considering a new investment. Financial projections for the investment are tabulated here. The corporate tax rate is 35 percent. Assume all sales revenue is received in cash, all operating costs and income taxes are paid in cash, and all cash flows occur at the end of the year. All net working capital is recovered at the end of the project. Year 0 Year 1 Year 2 Year 3 Year 4 Investment $ 44,000 Sales revenue 22,500 $23,000 $23,500 $20,500 Operating costs 4,700 4,800 4,900 4,100 Depreciation 11,000 11,000 1,000 11,000 Net working capital spending 500 550 600 500 ?a. Compute the incremental net income of the investment for each year. (Do not round intermediate calculations.)b. Compute the incremental cash flows of the investment for each year. (Do not round intermediate calculations. Negative amounts should be indicated by a minus sign.)c. Suppose the appropriate discount rate is 13 percent. What is the NPV of the project? (Do not round intermediate calculations and round your final answer to 2 decimal places. (e. g., 32.16))

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