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Triton Co. is considering a project that would have a ten-year life and would require a $1,400,000 investment in equipment. At the end of ten
Triton Co. is considering a project that would have a ten-year life and would require a $1,400,000 investment in equipment. At the end of ten years, the project would terminate and the equipment would have no salvage value. The project would provide net operating income each year as follows: Sales $1,700,000 -Variable Expenses 1.200.000 Contribution Margin 500,000 -Fixed Expenses: Fixed Out-of-Pocket Cash Expenses 200,000 Depreciation 120,000 320,000 Net Operating Income $180,000 All of the above items, except for depreciation, represent cash flows. The company's required rate of return is 12% a. Compute the project's net present value. b. Compute the project's internal rate of return to the nearest whole percent. c. Compute the project's payback period. d. Compute the project's simple rate of return to the nearest whole percent
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