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National University Operations And Supply Chain Management Assignment Help - Temple Corp.


Question - Temple Corp. is considering a new project whose data are shown below. The equipment that would
be used has a 3-year tax life, would be depreciated by the straight-line method over its 3-year life, and
would have a zero salvage value. No new working capital would be required. Revenues and other
operating costs are expected to be constant over the project's 3-year life. What is the project's NPV?
Risk-adjusted WACC 10.0%
Net investment cost (depreciable basis) $65,000
Straight-line deprec. rate 33.3333%
Sales revenues, each year $65,500
Operating costs (excl. deprec.), each year $25,000
Tax rate 35.0%

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