BookHintPrint-rencesParker & Stone, Incorporated, is looking at setting up a new manufacturing plant in SouthPark to produce garden tools. The company bought some land six years ago for $4.6million in anticipation of using it as a warehouse and distribution site, but the companyhas since decided to rent these facilities from a competitor instead. If the land were soldtoday, the company would net $4.9 million. The company wants to build its newmanufacturing plant on this land; the plant will cost $12.1 million to build, and the siterequires $730,000 worth of grading before it is suitable for construction. What is theproper cash flow amount to use as the initial investment in fixed assets when evaluatingthis project? (Do not round intermediate calculations and enter your answer in dollars,not millions of dollars, e.g., 1,234,567.)Cash flow amount

Current market value of land = $4.9 million. The land was purchased 6 years ago for use as a…

Answered: Parker & Stone, Incorporated, is…

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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