Kelly\'s Corner Bakery purchased a lot in Oil City five years ago at a cost of $

Question

Kelly's Corner Bakery purchased a lot in Oil City five years ago at a cost of $610,000. Today, that lot has a market value of $890,000. At the time of the purchase, the company spent $52,000 to level the lot and another $4,700 to install storm drains. The company now wants to build a new facility on that site. The building cost is estimated at $1,160,000. What amount should be used as the initial cash flow for this project? rev: 10_12_2016_QC_CS-65482 $-1,770,000 $-1,822,000 $-2,102,000 $-1,160,000 $-2,050,000

Explanation / Answer

initial cash flow

= building cost + market value

= 1160000 + 890000

= -2050000

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