W. Rooney Company. is considering a new project whose data are shown below. The equipment that would be used has a 3-year tax life, would be depreciated by the straight-line method over its 3-year life, and would have a zero salvage value. There is no need for a change in new working capital. Revenues and other operating costs are expected to be constant over the project's 3-year life. What is the project's NPV and IRR?
Risk-adjusted WACC 10%
Additional Net Working Capital needed $3,000
Net investment cost (depreciable basis) $65,000
Sales revenues, each year $65,500
Operating costs (excl. deprec.), each year $25,000
Tax rate 35%