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General Mills is considering a project to launch a new line of cereal. Given the following information, should GM accept the project? Cost of Equipment=
General Mills is considering a project to launch a new line of cereal. Given the following information, should GM accept the project?
Cost of Equipment= $50,000
Tax rate = 40% Investment in NWC = $25000
Required rate of return = 10%
Life of the project = 5 years
Net Income = $5000
Salvage value= $3000
The asset is depreciated to zero using straight line depreciation
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