Help Save & EX Chec Gaston Company is considering a capital budgeting project that would require a $1,900,000 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: $3,100,000 1,840,000 1,260,000 Sales Variable expenses Contribution margin Fixed expenses: Advertising, salaries, and other fixed out- of-pocket costs Depreciation Total fixed expenses Net operating income $580,000 380,000 960,000 $ 300,000 Click here to view Exhibit 138.1 and Exhibit 13B-2. to determine the appropriate discount factor(s) using tables. Required: Compute the project's net present value Net present value 1 of 2 Next > a O i rch Homework bon.com%252Fmghmiddleware%252Fm... Svet Help Save & Exit Check Winthrop Company has an opportunity to manufacture and sell a new product for a five-year period. To pursue this opportunity, the company would need to purchase a piece of equipment for $140,000. The equipment would have a useful life of five years and zero salvage value. It would be depreciated for financial reporting and tax purposes using the straight-line method. After careful study. Winthrop estimated the following annual costs and revenues for the new product: Annual revenues and costs: Sales revenues Variable expenses Fixed out-of-pocket operating costs $350,000 $195,000 $ 85,000 The company's tax rate is 30% and its after-tax cost of capital is 18%. Click here to view Exhibit 138.1 and Exhibit 138-2. to determine the appropriate discount factor(s) using tables. Required: 1. Calculate the annual income tax expense that will arise as a result of this investment. 2. Calculate the net present value of this investment opportunity. (Round your final answers to the nearest whole dollar.) 1 Annual income tax expense 2. Net present value