You are a manager at Northern Fibre, which is considering expanding its operations in synthetic fibre manufacturing. Your boss comes into your office, drops a consultant's report on your desk, and complains, "We owe these consultants $1.2 million for this report, and I am not sure their analysis makes sense. Before we spend the $29 million on new equipment needed for this project, look it over and give me your opinion." You open the report and find the following estimates (in millions of dollars): Sales revenue -Cost of goods sold 1 26.000 2 9 10 26.000 26.000 26.000 15.600 15.600 15.600 15.600 = Gross profit 10.400 10.400 10.400 10.400 -General, sales, and administrative expenses 2.320 2.320 2.320 2.320 - Depreciation 2.900 2.900 2.900 2.900 = Net operating income 5.1800 5.1800 5.1800 5.1800 - Income tax = Net income 1.813 1.813 1.813 1.813 3.367 3.367 3.367 3.367