Cochrane, Inc., is considering a new three-year expansion project that requires an initial fixed asset investment of $2,640,000. The fixed asset falls into the three-year MACRS class (MACRS Table). The project is estimated to generate $2,330,000 in annual sales, with costs of $1,320,000. The project requires an initial investment in net working capital of $168,000, and the fixed asset will have a market value of $193,000 at the end of the project. Assume that the tax rate is 35 percent and the required return on the project is 6 percent.

Requirement 1:

What is the net cash flow of the project for the following years?

Year       Cash Flow

0              -2,808,000$  

1              964469.2 

2              1067218 

3                

I am able to get 0-2 correct, but not 3.

Requirement 2:

What is the NPV of the project?

  NPV     $