A company needs an increase in working capital of $13,000 in a project that will

ID: 2378432 • Letter: A

Question

A company needs an increase in working capital of $13,000 in a project that will last 4 years. The company's tax rate is 33% and its discount rate is 10%.

Click here to view Exhibit 13B-1 to determine the appropriate discount factor(s) using table. The present value of the release of the working capital at the end of the project is closest to: (Round discount factor(s) to 3 decimal places and your final answer to the nearest whole number.) A company needs an increase in working capital of $13,000 in a project that will last 4 years. The company's tax rate is 33% and its discount rate is 10%. Click here to view Exhibit 13B-1 to determine the appropriate discount factor(s) using table. The present value of the release of the working capital at the end of the project is closest to: (Round discount factor(s) to 3 decimal places and your final answer to the nearest whole number.)

Explanation / Answer

The present value of the release of the working capital at the end of the project is closest to = 13,000/1.1^4 =$8,879.17

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A company needs an increase in working capital of $13,000 in a project that will

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