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Cardinal Company is considering a five-year project that would require a $2,975,000 investment in equipment with a useful life of five years and no salvage value. The companys discount rate is 14%. The project would provide net operating income in each of five years as follows:

Sales			$	2,735,000
Variable expenses				1,000,000
Contribution margin				1,735,000
Fixed expenses:
Advertising, salaries, and other fixed out-of-pocket costs	$	735,000
Depreciation		595,000
Total fixed expenses				1,330,000
Net operating income			$	405,000

Required:

A. What are the projects annual net cash inflows? B. What is the present value of the projects annual net cash inflows? (Round discount factor to 3 decimal places) C. What is the projects net present value? (Round discount factor(s) to 3 decimal places and final answer to the nearest whole dollar amount.) D.What is the project profitability index for this project? (Round discount factor(s) to 3 decimal places and final answer to 2 decimal places.) E.What is the projects internal rate of return? (%) (Round your answer to nearest whole percent.) F. What is the projects payback period? (Round your answer to 2 decimal places.) G.What is the projects simple rate of return for each of the five years? (%) (Round your answer to 2 decimal places) H. If the equipment had a salvage value of $300,000 at the end of five years, would you expect the projects payback period to be higher, lower, or the same? I. If the equipment had a salvage value of $300,000 at the end of five years, would you expect the project's net present value to be higher, lower, or the same? J.If the equipment had a salvage value of $300,000 at the end of five years, would you expect the projects simple rate of return to be higher, lower, or the same? K. Assume a postaudit showed that all estimates (including total sales) were exactly correct except for the variable expense ratio, which actually turned out to be 45%. What was the projects actual net present value? (round to 3 decimal places)

L.Assume a postaudit showed that all estimates (including total sales) were exactly correct except for the variable expense ratio, which actually turned out to be 45%. What was the projects actual payback period? (Round your answer to 2 decimal places.) (years)

M.Assume a postaudit showed that all estimates (including total sales) were exactly correct except for the variable expense ratio, which actually turned out to be 45%. What was the projects actual simple rate of return? (Round your answer to 2 decimal places.)