A quaint but well-established coffee shop, the Hot New Cafe,
wants to build a new cafe for increased capacity. Expected sales
are $800,000 for the first 5 years. Direct costs including labor
and materials will be 50% of sales. Indirect costs are estimated at
$200,000 a year. The cost of the building for the new cafe will be
a total of $850,000, which will be depreciated straight line over
the next 5 years. The firm's marginal tax rate is 38%,...