Posted by **Stacy** on Monday, March 5, 2012 at 2:19pm.

A well-established coffee shop, the Hot New Café, wants to build a new café for increased capacity. It’s 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 $100,000 a year. The cost of the building for the new cafe will be a total of $750,000, which will be depreciated straight line over the next 5 years. The firm's marginal tax rate is 37%, and its cost of capital is 12%.

## Answer This Question

## Related Questions

- finance - A quaint but well established cafe shoppe in the new hot cafe wants to...
- Budgeting - A quaint but well-established coffee shop, the Hot New Café, wants ...
- Corporate Finance - A company wants to build a new factory for increased ...
- finance - A company wants to build a new factory for increased capacity. Using ...
- Finance - A company wants to build a new factory for increased capacity. Using ...
- Math percentages - I have to compare two amounts given in percent. Last year, 80...
- accounting - The Bags and Luggage Company had the following account balances as...
- Math Accounting - Determine the proposal’s appropriateness and economic ...
- Capital Budgeting - A company has revenues of 100 per unit sold. Current sales ...
- finance - A company wants to buy a labor-saving piece of equipment. Using the ...

More Related Questions