The Burt Corporation is exploring an investment in a new ski manufacturing machine that has an estimated life of 3 years. The machine would cost $30,000 and the machine will be depreciated straight line over its three-year life to a residual value of zero. This investment will result in sales of 2000 skis in year one. Sales are estimated to grow by ten percent per year each year through year 3. The price per pair of skis is $18 and is to remain constant. The skis have a cost per unit to manufacture of $9/pair. It's costly to install the machine. it will require an increase in various net working capital accounts. It is estimated that the Burt Corporation needs to hold two percent of its annual sales in cash, four percent of its annual sales in accounts receivable, nine percent of its annual sales in inventory, and six percent of its annual sales in accounts payable. The firm is in the 35% tax bracket, and has a cost of capital of 10%. What is a) the incremental EBIT, b) depreciation, and c) net income in the first year (t-1) for this project? Incremental EBIT Depreciation Net Income Choose... Choose... # Choose...

The Burt Corporation is exploring an investment in a new ski manufacturing machine that has an estimated life of 3 years. The machine would cost $30,000 and the machine will be depreciated straight line over its three-year life to a residual value of zero. This investment will result in sales of 2000 skis in year one. Sales are estimated to grow by ten percent per year each year through year 3 . The price per pair of skis is $18 and is to remain constant. The skis have a cost per unit to manufacture of $9/p air. It's costly to install the machine. it will require an increase in various net working capital accounts. It is estimated that the Burt Corporation needs to hold two percent of its annual sales in cash, four percent of its annual sales in accounts receivable, nine percent of its annual sales in inventory, and six percent of its annual sales in accounts payable. The firm is in the 35% tax bracket, and has a cost of capital of 10%. What is a) the incremental EBIT, b) depreciation, and c) net income in the first year (t=1) for this project? Incremental EBIT Depreciation Net Income