Question

rate positively .. let me know if you need any clarification..

 computation of NPV year 0 1 2 3 4 5 Initial investment -450000 Working capital -25500 25500 Operating cash flow Saving 140000 140000 140000 140000 140000 Depreciation 90000 90000 90000 90000 90000 Saving after depreciation 50000 50000 50000 50000 50000 Tax @ 24% 12000 12000 12000 12000 12000 Saving after tax 38000 38000 38000 38000 38000 Cash flow 128000 128000 128000 128000 128000 Terminal cash flow 41800 55000*(1-24%) net cash flow -475500 128000 128000 128000 128000 195300 PVIF @ 12% 1 0.892857 0.797194 0.71178 0.635518 0.567427 present value -475500 114285.7 102040.8 91107.87 81346.31 110818.5 24099.18 Therefore answer = 24099.18

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