Cardinal Company is considering a five-year project that would require a $2,955,000 investment in equipment with a useful life of five years and no salvage value. The companys discount rate is 18%. The project would provide net operating income in each of five years as follows:

Sales		$ 2,865,000
Variable expenses		1,015,000
Contribution margin		1,850,000
Fixed expenses:
Advertising, salaries, and other fixed out-of-pocket costs	$ 750,000
Depreciation	591,000
Total fixed expenses		1,341,000
Net operating income		$ 509,000

3. What is the present value of the projects annual net cash inflows?

13. Assume a postaudit showed that all estimates (including total sales) were exactly correct except for the variable expense ratio, which actually turned out to be 45%. What was the projects actual net present value?

14. Assume a postaudit showed that all estimates (including total sales) were exactly correct except for the variable expense ratio, which actually turned out to be 45%. What was the projects actual payback period?

15. Assume a postaudit showed that all estimates (including total sales) were exactly correct except for the variable expense ratio, which actually turned out to be 45%. What was the projects actual simple rate of return?