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Gaston Company is considering a capital budgeting project that would require a $2,700.000 investment in equipment with a useful life of five years and no

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Gaston Company is considering a capital budgeting project that would require a $2,700.000 investment in equipment with a useful life of five years and no salvage value. The company's tax rate is 30% and its after-tax cost of capital is 13%. It uses the straight-line depreciation method for financial reporting and tax purposes. The project would provide net operating income each year for five years as follows $3,1ee, een 1,510, eee 1,590,00 Sales Variable expenses Contribution margin Fixed expenses: Advertising. salaries, and other fixed out of-pocket costs Depreciation Total Fixed expenses Not operating income $65e,eee 549, eee 1,190,eee $ 400,000 Click here to view Exhibit 138.1 and Exhibit 138.2. to determine the appropriate discount factor(s) using tables Required: Compute the project's not present value. Not prosent value

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