Cardinal Company is considering a five-year project that would require a $2,955,000 investment in equipment with a useful life of five years and no salvage value. The companys discount rate is 16%. The project would provide net operating income in each of five years as follows:

Sales $2,871,000

Variable expenses 1,018,000

Contribution margin 1,853,000

Fixed expenses:

Advertising, salaries, and other fixed out-of-pocket costs $753,000

Depreciation 591,000

Total fixed expenses 1,344,000

Net operating income $509,000

8. What is the projects simple rate of return for each of the five years?

13. Assume a postaudit showed that all estimates (including total sales) were exactly correct except for the variable expense ratio, which actually turned out to be 45%. What was the projects actual net present value?

14. Assume a postaudit showed that all estimates (including total sales) were exactly correct except for the variable expense ratio, which actually turned out to be 45%. What was the projects actual payback period?

15. Assume a postaudit showed that all estimates (including total sales) were exactly correct except for the variable expense ratio, which actually turned out to be 45%. What was the projects actual simple rate of return?