pulling out my hair to wonder if I am on the correct track..
Can an NPV of investment be negative?
Is there a calculator on line that can check my work for a investment building with cost 35mil, straight line depr basis to zero over ten year, own for 12 years sell it 6 million. Generate revenue of 8 mil per year with expenses of 3 mil. Taxable bond paying at 8% and marginal tax rate of 25% What is your NPV of this investment?
I started with NATCF to figure out Net after tax cash flow.
I followed on with NPV:
Years 8% discount NPV
0- -35M = -35M
1-5 4.625M with using table NPV 3.993 = 18.567M
6-10 4.625M 6.710-3.993 = 12.56
11-12 3.75M 7.536-6.710 = 3.0975
total = -.87
you have a 12 year salvage value
6 M - 6M(.25) = 4.5Million
Do you add the 4.5 M to -.87? for 3.63NPV