1)A proposed project would require the purchase of a new stamping machine. The stamping machine has a purchase price of $44,795. It is estimated it will cost $1,505 to ship and $2,497 to install. The stamping machine will be installed in an existing empty building that has a value of $9,876. It is estimated to stamping machine will require new inventory of $4,480 of which 40% will be on credit. What is the estimated Initial Investment [II]? If the stamping machine is depreciated straight-line to zero salvage over 8 years, what is the depreciation rate?

II = $50,589.00; Depreciation rate = $6,099.63

II = $51,485.00; Depreciation rate = $6,099.63

II = $60,465.00; Depreciation rate = $7,334.13

II = $61,361.00; Depreciation rate = $7,334.13

2)

A proposed project has an estimated annual revenue of $300,000, of which $30,000 will be A/R collected next year. Annual expenses are expected to be : rent @ $35,000; labor @ 71,000; depreciation @ $53,000. The tax rate is 30%. What is the expected Net Income?

		$35,700.00
		$88,700.00
		$98,700.00
		$151,700.00