Olinick Corporation is considering a project that would requ…
Questions
Olinick Cоrpоrаtiоn is considering а project thаt would require an investment of $349,000 and would last for 8 years. The incremental annual revenues and expenses generated by the project during those 8 years would be as follows (Ignore income taxes.): Sales $ 220,000 Variable expenses 21,000 Contribution margin 199,000 Fixed expenses: Salaries 39,000 Rents 52,000 Depreciation 47,000 Total fixed expenses 138,000 Net operating income $ 61,000 The scrap value of the project's assets at the end of the project would be $29,000. The cash inflows occur evenly throughout the year. The payback period of the project is closest to: