If Lews Steel Forms purchases $668,000 of new equipment, they can lower annual operating costs...
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If Lews Steel Forms purchases $668,000 of new equipment, they can lower annual operating costs by $390,000 The equipment will be depreciated straight-line to a zero book value over its 3-year ife Ignore bonus depreciation Ai the end of the three years, the equipment will be sold for an estimated $55,000. The equipment wil require the company to hold an extra $173,000 of inventory over the 3-year period. What is the NPV if the discount rate is 15 percent and the tax rate is 21 percent
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