Question

    Based on the following information- calculate the initial investment in the project.

    Cost of machine = Rs. 54,00,000

    Installation charges = Rs. 12,000

    Sunk cost = Rs. 23,000

    Working capital investment required at start= Rs. 1,00,000

    Revenue from products at end of year 1 = Rs. 2,40,000

    Tax rate = 12%

    A 54,12,000 Correct Answer Incorrect Answer
    B 55,12,000 Correct Answer Incorrect Answer
    C 54,00,000 Correct Answer Incorrect Answer
    D 55,23,000 Correct Answer Incorrect Answer
    E 54,35,000 Correct Answer Incorrect Answer

    Solution

    Initial investment = Cost of machine + installation charges + working capital Initial investment = 55,12,000

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