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Gaston Company is considering a capital budgeting project that would require a $2,600,000 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 $2,600,000 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 16%. 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: Sales Variable expenses $3,400,000 1,780,000 1,620,000 Contribution margin Flxed expenses: Advertising, salaries, and other fixed out-of-pocket costs 520,000 Total foxed expenses 1,080,000 Net operating income $ 540,000 Cick here to wew Exhibit,13B-1 and Exhibit 138-2, to determine the appropriate discount factorts) using Compute the projects net present value. (Round discount factor(s) to 3 decimal places.) MacBook Air esc F3 F4 FS FT

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