Cost of carrying imventory d. Compute the amortization expense on new plant and equipment. Amortization expense e. Add together all the costs in parts b, c, and d Total cost Apollo Data Systems is considering a promotional campaign that will increase annual credit sales by $548,000. The company has a 60% cost of goods sold and will require investments in accounts recelvable, inventory and plant and equipment: The turnover for cach is as follows: All $548,000 of the sales will be collectible. However, collection costs will be 4 percent of sales, and production and selling costs will be 72 percent of sales. The cost to carry inventory will be 10 percent of inventory. Amortization expense on plant and equipment will be 4 percent of plant and equipment. The tax rate is 30 percent. Inventory is calculated using cost of goods sold and not sates. a. Compute the investments in accounts recelvable, inventory, and plant and equipment based on the turnover ratios. What is the total value of the investment made? b. Compute the accounts recelvable collection costs and production and selling costs and add the fwo figures together. 1. Compute income after taxes. Income after taxes s g. If the firm has required return on investment of 14 percent, should it undertake the promotional campaign described throughout this problem? Yes No Problem 7.27 In the previous problem, if imventory had only been 2 times. a. What would be the new value for inventory investment? Inventory investment b.1 What would be the retum on investment? You need to recompute the total investment and the total costs of the campaign to work toward computing income after taxes. (Alound the final answer to 1 docimal place.) Rate of retum b. 2 should the compaign be undertaken