Summer Tyme, Inc., is considering a new 3-year expansion project that requires an initial fixed asset investment of $3.9 million. The fixed asset falls into the 3-year MACRS class (MACRS Table) and will have a market value of $306,600 after 3 years. The project requires an initial investment in net working capital of $438,000. The project is estimated to generate $3,504,000 in annual sales, with costs of $1,401,600. The tax rate is 33 percent and the required return on the project is 18 percent.

Required:

(a) What is the project's year 0 net cash flow?

(b) What is the project's year 1 net cash flow?

(c) What is the project's year 2 net cash flow?

(d) What is the project's year 3 net cash flow?

(e) What is the NPV?