apozo Corporation has provided the following information concerning a capital budgeting project: $ 514,000 Investment required in equipment Net annual operating cash inflow $ 281,000 Tax rate After-tax discount rate 30% 7% he expected life of the project and the equipment is 3 years and the equipment has zero salvage value. The company uses straight- ne depreciation on all equipment and the depreciation expense on the equipment would be $171,333 per year. Assume cash flows ccur at the end of the year except for the initial investments. The company takes income taxes into account in its capital budgeting. he net annual operating cash inflow is the difference between the incremental sales revenue and incremental cash operating xpenses. Click here to view Exhibit 14B-1 to determine the appropriate discount factor(s) using table. Cequired: Determine the net present value of the project. (Round intermediate calculations and final answer to the nearest dollar amount.) Net present value

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Rapozo Corporation has provided the following information concerning a capital budgeting project:
Investment required in equipment
Net annual operating cash inflow
Tax rate
After-tax discount rate
$ 514,000
$ 281,000
Net present value
30%
7%
The expected life of the project and the equipment is 3 years and the equipment has zero salvage value. The company uses straight-
line depreciation on all equipment and the depreciation expense on the equipment would be $171,333 per year. Assume cash flows
occur at the end of the year except for the initial investments. The company takes income taxes into account in its capital budgeting.
The net annual operating cash inflow is the difference between the incremental sales revenue and incremental cash operating
expenses.
Click here to view Exhibit 14B-1 to determine the appropriate discount factor(s) using table.
Required:
Determine the net present value of the project. (Round intermediate calculations and final answer to the nearest dollar amount.)
Transcribed Image Text:Rapozo Corporation has provided the following information concerning a capital budgeting project: Investment required in equipment Net annual operating cash inflow Tax rate After-tax discount rate $ 514,000 $ 281,000 Net present value 30% 7% The expected life of the project and the equipment is 3 years and the equipment has zero salvage value. The company uses straight- line depreciation on all equipment and the depreciation expense on the equipment would be $171,333 per year. Assume cash flows occur at the end of the year except for the initial investments. The company takes income taxes into account in its capital budgeting. The net annual operating cash inflow is the difference between the incremental sales revenue and incremental cash operating expenses. Click here to view Exhibit 14B-1 to determine the appropriate discount factor(s) using table. Required: Determine the net present value of the project. (Round intermediate calculations and final answer to the nearest dollar amount.)
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