The company is considering the purchase of machinery and
equipment to set up a line to produce a combination washer-dryer.
They have given you the following information to analyze the
project on a 5-year timeline:
Initial cash outlay is $150,000, no residual value.
Sales price is expected to be $2,250 per unit, with $595 per
unit in labor expense and $795 per unit in materials.
Direct fixed costs are estimated to run $20,750 per month.
Cost of capital is 8%,...