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Your CEO has asked you to evaluate launching a new product line for your company. Based on your experience and knowledge of the market, you
Your CEO has asked you to evaluate launching a new product line for your company. Based on your experience and knowledge of the market, you have estimated the following results for the first five (5) years of the Project: The Company yearly purchases (Cost Of Goods Sold - COGS) from suppliers are 50% of the forecasted sales. General and administrative expenses (wages, taxes, office etc.) are estimated at 15% of sales. Sales salaries and commissions are estimated to be 10% of sales. The Project requires and initial equipment investment of $150,000. Annual depreciation expense of the equipment is $50,000. Annual interest expense on the money borrowed to pay for the equipment is $18,000.- The company tax rate is 35%
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