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Kaual Tools inc. is planning to invest in new manufacturing equipment to make a new garden tool. The new garden toof is axpected to generate
Kaual Tools inc. is planning to invest in new manufacturing equipment to make a new garden tool. The new garden toof is axpected to generate additional annual sales of 7,500 units at $38 each. The now manufacturing equipment will cost $121,800 and is expected to have a 10-year life and a $9,300 residual value. Selling axpenses related to the new product are expected to be 5% of sales revanue. The cost to manufocture the product includes the following on a per-unit basis: Determine the net cash flows for the first year of the project, Years 2-9, and for the last year of the project. Use the minus sign to indicete cash outhiows, Do not round your intermediate calculations but, if required, round your final answers to the nearest dollar. Kauai Tools Ine. Net Cash Flowrs Une Item Description Initial Investment Operating cash flows: Annual revenues Selling expenses Cost to manufocture: Net operating cash flows Total for Year 1 Total for Years 29 (operating cash fow) Residual value Total for last year
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