Yummy Foods is considering a new salsa product whose data are shown below. The equipment that would be used has a 3-year tax life and would be depreciated by the straight-line method over the project’s 3-year life. Revenues and other operating costs are expected to be constant over the project’s 3-year life. What is the NPV? (Please be sure to show your calculation)

Hurdle Rate                                                                                                     10%

Net initial investment                                                                                       $60,000

Initial increase in NOWC                                                                                   $10,000

Salvage value                                                                                                  $10,000

Sales Revenues                                                                                                $70,000

Operating costs excluding depreciation                                                                $30,000

Tax rate                                                                                                           40%