Matheson Electionies has tust developed a new etectionic device that a believes will have broad market appeal The company has performed marketing and cost studies that revealed the following information. a. New equipment would have to be acquired to produce the device the equipment would cost $38000 and have a s ax-yelir useful Iife Anter shxyears it would have a salvage value of about $24,000. b. Sales in units cyer the next six years are projected to be as follows CProductionand sares of the degice would require working capital of sa6,000 to finance accounts receivable thyeritories and dayto-day castinesisi The working sapital would be released at the end of the project's life d. The devicee whuld set for 556 eschevoriable costs for producton, administration, and sales would be sas per unit. $149,000 per yeat (Deprocotion is based on cost less zatesge value) f. To gain rapli enty into the market, the company would have to actuertise heavily. The advertising costs would bet a The company's requiced tate of return is 13% Chick here to view Exbibitiz8 4 and Exbibit 128 is. to determine the appropitate discount factorta) using tables. Required: Click here to view Exhibit 12B=1 and Exhibit 12B.2. to determine the appropriate discount factor(s) using tables: Required: 1. Compute the net cash inflow (incremental contribution margin minus incremental fixed expenses) anticipated from sale of the der for each year over the next six years. 2-a. Using the data computed in (1) above and other data provided in the problem, determine the net present value of the proposec investment 2-b. Would you recommend that Matheson accept the device as a new product? ( Answer is not complete. Complete this question by entering your answers in the tabs below. Compute the net cash inflow (incremental contribution margin minus incremental fixed expenseg) antidpated from nale of the device for each year over the next six years. (Negative amounts should be indicated by a minus sign.) g. The company's required rate of return is 13% Click here to view Exhibit 12B-1 and Exhibit12B-2, to determine the appropriate discount factor(s) using tables. Required: 1. Compute the net cash inflow (incremental contribution margin minus incremental fixed expenses) anticipated f for each year over the next six years. 2-a. Using the data computed in (1) above and other data provided in the problem, determine the net present val investment. 2-b. Would you recommend that Matheson accept the device as a new product? (x) Answer is not complete. Complete this question by entering your answers in the tabs below. Using the data computed in (1) above and other data provided in the problem, determine the net present value of the proposed investment. (Negative amounts should be indicated by a minus sign. Round your final answer to the nearest w dollar amount.) rewent Value of $1,1(1+r)B
