Bruno's lunch counter is expanding and expects operating cash flows of $26,900 a year for 6 years as a result. this expansion requires $92,700 in new fixed assets. these assets will be worthless at the end of the project. in addition, the project requires $6,600 of net working capital throughout the life of the project. what is the net present value of this expansion project at a required rate of return of 13 percent?

Net present value of this expansion project is 8234.

Explanation:

To get the net present value,  we make a cash-flow in excel. See document attached.

At moment 0 the investment is =$(92.700), also we consider the working capital =(6.600)

Moment 1 to 6 = $26.900

We calculate the Net cash flow (that is the difference between benefits and cost).

To get net present value, we use VNA formula.  ( =VNA(required rate of return; Net cash flow from moment 0 to moment 6) +Net cash flow at moment 0)

Net present value is 8234

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answer; consideration;