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Required information The following information applies to the questions displayed below.] Cardinal Company is considering a five-year project that would require a $2,810,000 investment in
Required information The following information applies to the questions displayed below.] Cardinal Company is considering a five-year project that would require a $2,810,000 investment in equipment with a useful life of five years and no salvage value. The company's discount rate is 16%. The project would provide net operating income in each of five years as follows: $2,847,000 1,121,000 1,726,000 Sales Variable expenses Contribution margin Fixed expenses: Advertising, salaries, and other 782,000 562,000 fixed out-of-pocket costs Depreciation 1,344,000 $ 382,000 Total fixed expenses Net operating income Click here to view Exhibit 138-1 and Exhibit 138-2, to determine the appropriate discount factor(s) using table. What is the project profitability index for this project? (Round your answer to 2 decimal places.)
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