Declan macmanus is considering a capital budgeting project. this project willinitially require a $25,000 investment in equipment and a $3,000 working capitalinvestment. the useful life of this project is 5 years with an expected salvage value ofzero on the equipment. the working capital will be released at the end of the 5 years. the new system is expected to generate net cash inflows of $9,000 per year in each of the5 years. also a repair of the equipment will be required at the end of year 3, costing$5,000. macmanus’ discount rate is 14%. the net present value of this project is closestto (ignoring taxes): a)$(3,088)b)$1,079c)$2,522d)$4,454e )$3,375

Baskin promotions, inc. sells t-shirts decorated for a variety of concert performers. the company has developed the following budget for the coming year based on a sales forecast of 80,000 t-shirts: sales $ 1,400,000 cost of goods sold 820,000 gross profit 580,000 operating expenses ($100,000 is fixed) 418,400 operating income 161,600 income taxes (30% of operating income) 48,480 net income $ 113,120 cost of goods sold and variable operating expenses vary directly with sales, and the income tax rate is 30% at all levels of operating income. if the concert season is slow due to poor weather, baskin estimates that sales could fall to as low as 60,000 t-shirts. assume baskin actually achieves the 60,000 unit sales level, and that net income actually earned at this level was $70,000. a performance report would indicate that net income was: