Consider the case of Happy Dog Soap:

Happy Dog Soap is considering an investment that will have the following sales, variable costs, and fixed operating costs:

	Year 1	Year 2	Year 3	Year 4
Unit sales (units)	4,800	5,100	5,000	5,120
Sales price	$22.33	$23.45	$23.85	$24.45
Variable cost per unit	$9.45	$10.85	$11.95	$12.00
Fixed operating costs except depreciation	$32,500	$33,450	$34,950	$34,875
Accelerated depreciation rate	33%	45%	15%	7%

This project will require an investment of $25,000 in new equipment. The equipment will have no salvage value at the end of the projects four-year life. Happy Dog Soap pays a constant tax rate of 40%, and it has a required rate of return of 11%.

When using accelerated depreciation, the projects net present value (NPV) is . (Hint: Round each element in your computationincluding the projects net present valueto the nearest whole dollar.)

When using straight-line depreciation, the projects NPV is . (Hint: Again, round each element in your computationincluding the projects net present valueto the nearest whole dollar.)