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Use the following information to answer the 8 questions (filling in the blanks) that follow it. When answering the questions, DO NOT use dollar signs,

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Use the following information to answer the 8 questions (filling in the blanks) that follow it. When answering the questions, DO NOT use dollar signs, USE commas to separate thousands, DO NOT use parenthesis to denote negative numbers, USE the negative sign and place it in front of first digit of your answer when your answer is a negative number. Round to the nearest dollar (do not enter decimals). RET Inc. currently has one product, low-priced stoves. RET Inc. has decided to sell a new line of medium-priced stoves. Sales for the new line of stoves are estimated at $30 million a year. Variable costs are 75% of sales. The project is expected to last 10 years. In addition to the production variable costs, the fixed costs each year will be $4,000,000. The company has spent $1,000,000 in research and a marketing study that determined the company will lose $10 million in sales a year of its existing low- priced stoves. The production variable cost of the existing low-priced stoves is $8 million a year. The plant and equipment required for producing the new line of stoves costs $10,000,000 and will be depreciated down to zero over 20 years using straight-line depreciation. It is expected that the plant and equipment can be sold (market or scrap value) for $6,000,000 at the end of 10 years. The new stoves will also require today an increase in net working capital of $2,000,000 that will be returned at the end of the project. The tax rate is 40 percent and the cost of capital is 10%. 1. What is the initial outlay (10) for this project? Ay 2. What is the annual Earnings before Interests, Taxes, and Depreciation (EBIDTA) for this project? 3. What is the annual taxable income (or earnings before taxes) for this project? 4. What is the annual Net Income (NI) for this project? A/ 5. What is the operating cash flow (OCF) for this project? 6. What is the remaining book value for the plant at equipment at the end of the project? 7. What is the termination value for this project? A/ 8. What is the Net Present Value (NPV) for this project

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