century roofing is thinking of opening a new warehouse, and the key data are shown below. the company owns the building that would be used, and it could sell it for $100,000 after taxes if it decides not to open the new warehouse. the equipment for the project would be depreciated by the straight-line method over the project's 3-year life, after which it would be worth nothing and thus it would have a zero salvage value. no new working capital would be required, and revenues and other operating costs would be constant over the project's 3-year life. what is the project's npv? (hint: cash flows are constant in years 1-3.) wacc 10.0% opportunity cost $100,000 net equipment cost (depreciable basis) $65,000 straight-line deprec. rate for equipment 33.333% sales revenues, each year $123,000 operating costs (excl. deprec.), each year $25,000 tax rate 35%
