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CK=m_1511 19781520 Kathleen Hernand Home Grades Personalized ReviewsDiscussion Course Materials apital Budgeting and Cash Flow Analysis raded Assignment | Due Saturday 11.25.17 at 11:45 PR Attempts: 7. The estimation of a project's net investment and net annual cash flows Consider the case of Collins Construction Co. Keep the Highest: /4 Aa Aa Collins Construction Co. currently earns annual revenues of $750,000 and incurs total operating expenses (excluding depreciation and interest expense) of 42.50% of revenues. Its earnings are taxed at a rate of 40% Today, its budgeting committee is evaluating the purchase of a new forkift. The forklift is expected to cost $60,000, plus $4,000 in freight and setup expenses, and will be depreciated using straight-line depreciation. It is expected that the forklift will have a useful life of 10 years and a $60,000. It is expected that the forklift will be sold for its book value, such that no capital gain or loss will be realized. salvage value equal to 25.00% of its purchase price of It is further expected that the forklift will cause a 20.00% increase in the firm's annual sales and total operating expenses (excluding depreciation and interest expense). If the forklift is purchased, the firm will require an additional $10,000 in net working capital (NWC). iven this information, complete the following analysis: . Question Answer what is the annual depreciation expense for the forklift? What is the net investment (NINV) of the investment? What are the net annual operating after-tax cash flows associated with this project? what is the project's last year (terminal) cash flow? [ .- Grade it Now Save & Continue Continue without saving

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