Matheson Electronics has just developed a new electronic device that it believes will have broad market appeal. The company has performed marketing and cost studies that revealed the following information: a. New equipment would have to be acquired to produce the device. The equipment would cost $486,000 and have a six-year useful life. After six years, it would have a salvage value of about $24,000 b. Sales in units over the next six years are projected to be as follows: 23,008 25,000 27,000 4-6 c. Production and sales of the device would require working capital of $63,000 to finance accounts receivable, inventories, and day- to-day cash needs. This working capital would be released at the end of the project's life d. The devices would sell for $35 each; variable costs for production, administration, and sales would be $20 per unit. e. Fixed costs for salaries, maintenance, property taxes, insurance, and straight-line depreciation on the equipment would total $159,000 per year. (Depreciation is based on cost less salvage value) f To gain rapid entry into the market, the company would have to advertise heavily. The advertising costs would be