Parker amp stone inc is looking at setting up a new, Ask an Expert

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Parker & Stone, Inc., is looking at setting up a new manufacturing plant in South Park to produce garden tools. The company bought some land 9 years ago for $5 million in anticipation of using it as a warehouse and distribution site, but the company has since decided to rent these facilities from a competitor instead. If the land were sold today, the company would net $9.4 million. The company wants to build its new manufacturing plant on this land; the plant will cost $14.2 million to build, and the site requires $846,000 worth of grading before it is suitable for construction.

Required :

What is the proper cash flow amount to use as the initial investment in fixed assets when evaluating this project?

$23,600,000

$25,668,300

$24,446,000

$22,754,000

$19,068,160

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M92319711

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