Oakmont Company has an opportunity to manufacture and sell a new product for a four-year period. The company's discount

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Oakmont Company Has An Opportunity To Manufacture And Sell A New Product For A Four Year Period The Company S Discount 1 (22.87 KiB) Viewed 26 times

Oakmont Company has an opportunity to manufacture and sell a new product for a four-year period. The company's discount rate is 17%. After careful study. Oakmont estimated the following costs and revenues for the new product: Cost of equipment needed Working capital needed $ 225,000 $ 80,000 $7,000 Overhaul of the equipment in two years Salvage value of the equipment in four years Annual revenues and costs: $ 10,000 Sales revenues Variable expenses $360,000 $ 175,000 $ 81,000 Fixed out-of-pocket operating costs When the project concludes in four years the working capital will be released for investment elsewhere within the company. Click here to view Exhibit 148-1 and Exhibit 148-2, to determine the appropriate discount factor(s) using tables. Required: Calculate the net present lue of this investment opportunity. (Round your final answer to the nearest whole dollar amount.) Net present value