ACCT 556 help A Guide to career/Snaptutorial ACCT 556 help A Guide to career/Snaptutorial | Page 7

Week 4 Capital Budgeting Practice problem: You have the following data about a proposed project: Cost of new equipment $80,000 Increase need for Working Capital (to be released at end of project) $20,000 Length of project 6 years Salvage Value of equipment at end of project $8,000 Annual cash savings if equipment is purchased (cash inflows) $28,500 Tax rate 35% Discount rate required of all investements 14% Required: