A project requires an initial investment of $500,000 and expects to produce an after-tax operating cash flow of $180,000 per year for three years. The asset value will be depreciated to zero using straight-line depreciation over the three years. At the end of the project, the asset could be sold at market price. Assume a 21% tax rate and 15% cost of capital.
What is the market price of the fixed asset that will make this project break even?
Already registered? Login
Not Account? Sign up
Enter your email address to reset your password
Back to Login? Click here