9...LeoneCompany produces flash drives for computers, which it sells for $20 each. Each flash drive costs $6 of variable costs to make. During April, 1,000 drives were sold. Fixed costs for March were $2per unit for a total of $1,000 for the month. How much is the contribution margin ratio?

10...Aaron Co. is considering purchasing a new machine which will cost $200,000, but which will decrease costs each year by $40,000. The useful life of the machine is 10 years. The machine would be depreciated straight-line with no residual value over its useful life at the rate of $20,000/year. The cash payback period is

11...ABC Company is considering two capital investment proposals. Estimates regarding each project are provided below:

Project Blue Project Gray

Initial investment $400,000 $550,000

Annual net income 20,000 47,000

Net annual cash inflow 100,000 125,000

Estimated useful life 5 years 7 years

Salvage value 0 0

The company requires a 9% rate of return on all new investments.

Attach an MS Excel document showing formulas for Project Gray 1) the present value of the cash flows, 2) the net present value of this project and 3) the time it takes to get the cash pay back.