Down Under Boomerang, Inc., is considering a new 3-year expansion project that requires an initial fixed...

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Down Under Boomerang, Inc., is considering a new 3-yearexpansion project that requires an initial fixed asset investmentof $2.3 million. The fixed asset falls into the 3-year MACRS class(MACRS schedule). The project is estimated to generate $1,720,000in annual sales, with costs of $628,000. The project requires aninitial investment in net working capital of $270,000, and thefixed asset will have a market value of $210,000 at the end of theproject. a. If the tax rate is 22 percent, what is the project’sYear 0 net cash flow? Year 1? Year 2? Year 3? (A negative answershould be indicated by a minus sign. Do not round intermediatecalculations and enter your answers in dollars, not millions ofdollars, rounded to two decimal places, e.g., 1,234,567.89.) b. Ifthe required return is 10 percent, what is the project's NPV? (Donot round intermediate calculations and enter your answer indollars, not millions of dollars, rounded to two decimal places,e.g., 1,234,567.89.) This is the last question in the assignment.To submit, use Alt + S. To access other questions, proceed to thequestion map button. Next

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Down Under Boomerang, Inc., is considering a new 3-yearexpansion project that requires an initial fixed asset investmentof $2.3 million. The fixed asset falls into the 3-year MACRS class(MACRS schedule). The project is estimated to generate $1,720,000in annual sales, with costs of $628,000. The project requires aninitial investment in net working capital of $270,000, and thefixed asset will have a market value of $210,000 at the end of theproject. a. If the tax rate is 22 percent, what is the project’sYear 0 net cash flow? Year 1? Year 2? Year 3? (A negative answershould be indicated by a minus sign. Do not round intermediatecalculations and enter your answers in dollars, not millions ofdollars, rounded to two decimal places, e.g., 1,234,567.89.) b. Ifthe required return is 10 percent, what is the project's NPV? (Donot round intermediate calculations and enter your answer indollars, not millions of dollars, rounded to two decimal places,e.g., 1,234,567.89.) This is the last question in the assignment.To submit, use Alt + S. To access other questions, proceed to thequestion map button. Next