Your firm is considering building a new office complex.Your firm already owns land suitable for the new complex.The current book value of the land is $100,000;however,a commercial real estate agent has informed you that an outside buyer is interested in purchasing this land and would be willing to pay $650,000 for it.When calculating the net present value (NPV)of your new office complex,ignoring taxes,the appropriate incremental cash flow for the use of this land is:
A)$650,000
B)$0
C)$100,000
D)$750,000

Question

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The Answer of Your firm is considering building a new office complex.Your firm already owns land suitable for the new complex.The current book value of the land is $100,000;however,a commercial real estate agent has informed you that an outside buyer is interested in purchasing this land and would be willing to pay $650,000 for it.When calculating the net present value (NPV)of your new office complex,ignoring taxes,the appropriate incremental cash flow for the use of this land is:
A)$650,000
B)$0
C)$100,000
D)$750,000

Your Firm Is Considering Building a New Office Complex