Question: Current Attempt in Progress A beauty product company is developing a new fragrance named Happy Forever. There is a probability of 0.52 that consumers will
Current Attempt in Progress A beauty product company is developing a new fragrance named Happy Forever. There is a probability of 0.52 that consumers will love Happy Forever, and in this case, annual sales will be 1.04 million bottles: a probability of 0.39 that consumers will find the smell acceptable and annual sales will be 173,000 bottles; and a probability of 0.09 that consumers will find the smell unpleasant and annual sales will be only 47,000 bottles. The selling price is $35, and the variable cost is $9 per bottle. Fixed production costs will be $1.09 million per year. and depreciation will be $1.17 million. Assume that the marginal tax rate is 27 percent. What are the expected annual incremental after-tax free cash flows from the new fragrance? (Round answer to 0 decimal places, eg. 5, 275.) Annual incremental cash flows
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