=+Annual cash flows Project X Project Y Inflow from sales Cash outflows: Materials 2,100,000 1,900,000 800,000 200,000

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=+Annual cash flows Project X Project Y Inflow from sales Cash outflows: Materials 2,100,000 1,900,000 800,000 200,000 Labour 300,000 700,000 Overheads 100,000 50,000 (1,200,000) (950,000) Net cash flow 900,000 950,000

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