division plant & equipment on a 10-year, straight-line basis. Total initial investment costs for the launch of the Seltzer Products are listed below. Table 3 Initial Investment Costs Branston has the following projections for total operating assets and working capital investments for each year for the Seltzer Products division: Table 5 Division Financial Information Plant & equipment $2,760,000 Initial working capital $240,000 Total initial investment: $3,000,000 Branston expects to sell 600,000 cans of hard seltzer in the first year, 1 million cans in the second year, and 2 million cans in the third year. After the third year, Branston believes the hard seltzer market will be mature and expects nominal growth of 3% per year. As a result, variable selling expenses will increase as Branston will offer promotions with price cuts to maintain market share. Product costs are projected as follows: Table 4 Division Projections Seltzer Products Cans Sales price per can 20x1 600,000 $4.00 20x2 1,000,000 $4.00 20x3 2,000,000 $4.00 20x4 3% growth $4.00 20x5 3% growth $4.00 Direct materials per can $0.75 Direct labor per can $1.00 Variable overhead per can $0.50 Variable selling costs per can $0.10 Total fixed factory overhead $400,000 $0.10 $600,000 $0.10 $0.15 $0.25 $800,000 $800,000 $800,000 Total Selling, General, & Administrative (SG&A) $200,000 $210,000 $220,000 $235,000 $250,000 Seltzer Products Total Operating Assets 20x1 $2,724,000 20x2 20x3 $2,608,000 $2,732,000 $2,481,000 $2,230,000 20x4 20x5 Investment in Working Capital $240,000 $160,000 $400,000 $25,000 $25,000