Solution-Determine the net cash flows for the first year of

Determine the net cash flows for the first year of project

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Reference no: EM131788633

Question - Out of Eden, Inc. is planning to invest in new manufacturing equipment to make a new garden tool. The new garden tool is expected to generate additional annual sales of 9,000 units at $42 each. The new manufacturing equipment will cost $156,000 and is expected to have a 10-year life and $12,000 residual value. Selling expenses related to the new product are expected to be 5% of sales revenue. The cost to manufacture the product includes the following on a per-unit basis:

Direct labor	$7.00
Direct materials	23.40
Fixed factory overhead-depreciation	1.60
Variable factory overhead	3.60
Total	$35.60

Required - Determine the net cash flows for the first year of the project, Years 2-9, and for the last year of the project. Use the minus sign to indicate cash outflows.

Reference no: EM131788633

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Determine the net cash flows for the first year of project : Out of Eden, Inc. is planning to invest in new manufacturing equipment to make new garden tool. Determine the net cash flows for the first year of the project

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Determine the net cash flows for the first year of project

Reference no: EM131788633

Reference no: EM131788633

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