Cardinal Company is considering a five-year project that would require a $2,500,000 investment in equipment with a useful life of five years and no salvage value. The companys discount rate is 12%. The project would provide net operating income in each of five years as follows:

Sales			$	2,853,000
Variable expenses				1,200,000
Contribution margin				1,653,000
Fixed expenses:
Advertising, salaries, and other fixed out-of-pocket costs	$	790,000
Depreciation		500,000
Total fixed expenses				1,290,000
Net operating income			$	363,000

2. What are the projects annual net cash inflows?

4. What is the projects net present value? (Round discount factor(s) to 3 decimal places and final answer to the nearest whole dollar amount.)

5. What is the project profitability index for this project?

6. What is the projects internal rate of return?

8. What is the projects simple rate of return for each of the five years? (Round your answer to 2 decimal places.)

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 50%. What was the projects actual net present value? (Negative amount should be indicated by a minus sign. Round discount factor(s) to 3 decimal places, intermediate calculations and final answer to the nearest whole dollar amount.)