Forise Water Company drills small commercial water wells. The company is in the process of analyzing the purchase of a new drill. Information on the proposal is provided below.           Initial investment:         Asset                                        $700,000         Working capital                          $188,000         Operations (per year for four years):         Cash receipts                            $530,000         Cash expenditures                     $240,000         Disinvestment:         Salvage value of drill (existing)   $120,000         Discount rate                                    18%   What is the net present value of the investment? Assume there is no recovery of working capital.

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Production Budget

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