(A). Gear Inc. has just finished up its year. Use the information below to compute the company's Net Income. Note that some items might not be needed. If Gear Inc has negative taxable income, the firm will receive a tax credit based on the same percentage as its tax rate. Answer to the nearest dollar. Do not enter a $ sign.

Accounts Payable	75,000
Common Equity	843,000
Cost of Goods Sold	422,000
Current Liabilities	212,000
Depreciation	116,000
Dividends to shareholders	21,000
Interest Expense	67,000
Interest Income	22,000
Inventory	92,000
Research & Development Expense	36,000
Sales	767,000
Selling, General & Admin. Expense	101,000
Taxes (% of taxable income)	23%
Total Assets	596,000

(B).

In the context of estimating cash flows for an investment project, an upfront (i.e., at year 0) investment in working capital . . .

Select one:

a.

none of the other choices here are correct

b.

would be depreciated over the life of the project

c.

would be ignored (i.e., would not factor into the analysis of the project)

d.

would be written off as an operating expense in year 1 (not year 0)

e.

would be written off as an operating expense at year 0