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Please answer all. I beg of you. thanks in advance! Cardinal Company is considering a project that would require a $2,975,000 investment in equipment with
Please answer all. I beg of you. thanks in advance!
Cardinal Company is considering a project that would require a $2,975,000 investment in equipment with a useful life of five years. At the end of five years, the project would terminate and the equipment would be sold for its salvage value of $300,000. The company's discount rate is 14%. The project would provide net operating income each year as follows: Sales Variable expenses $2,735,000 1,000,000 1,735,000 Contribution margin Fixed expenses: Advertising, salaries, and other fixed out-of-pocket costs Depreciation $735,000 535,000 Total fixed expenses 1,270,000 Net operating income $ 465,000Step by Step Solution
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