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ZXY Company is a food product company. ZXY is considering expanding to two new products and a second production facility. The food products are staples

ZXY Company is a food product company. ZXY is considering expanding to two new products and a second production facility. The food products are staples with steady demands. The proposed expansion will require an investment of $7,000,000 for equipment with an assumed ten-year life, after which all equipment and other assets can be sold for an estimated $1,000,000. They will be renting the facility. ZXY requires a 12 percent return on investments. You have been asked to recommend whether or not to make the investment.

Estimates of Revenues Before Decision is Made ?Risks Associated with Investment?

Expenses Made Before Decision is Made?

Difference Between Using Straight Line Vs. MACRS Depreciation?

Recommendation for Course of Action?

Recommendation?

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