9. Snack Food Developmentllntroduction. David D. Jones suggested that the company use the excess capacity in its Darwin facility to produce a line of snack foods of dried fruits to be test-marketed in Northern Territory. He noted the strength of the HooRoo brand in that area and the success of other food and beverage companies that had expanded into snack food production. He also argued that the company's reputation for wholesome, quality products would be enhanced by a line of dried fruits and that name association with the new product would probably even lead to increased sales of the company's other products among health-conscious consumers. Equipment and working capital invests were expected to total $1 .5million and $300,000, respectively, for this project. The equipment would be depreciated over seven years. Assuming the test market was successful, cash ows from the project would be able to support further plant expansions in other strategic locations. The IRR was expected to be 20.5 percent, well above the IRR required for new product projects (12 percent)