Business, 16.07.2019 20:30 arivalen

Sunk costs and opportunity costs masters golf products, inc., spent 2 years and $ 1 comma 050 comma 000 to develop its new line of club heads to replace a line that is becoming obsolete. to begin manufacturing them, the company will have to invest $ 1 comma 850 comma 000 in new equipment. the new clubs are expected to generate an increase in operating cash inflows of $ 744 comma 000 per year for the next 11 years. the company has determined that the existing line could be sold to a competitor for $ 256 comma 000. a. how should the $ 1 comma 050 comma 000 in development costs be classified? b. how should the $ 256 comma 000 sale price for the existing line be classified? c. what are all the relevant cash flows for years 0 thru 11? (note: assume that all of these numbers are net of taxes.)

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Sunk costs and opportunity costs masters golf products, inc., spent 2 years and $ 1 comma 050 comma...

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