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work Metheson 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 $480,000 and have a six year useful ife. After six years, it would have a salvage value of about $12,000 b. Sales in units over the next six years are projected to be as follows 20,909 24,009 c Production and sales of the device would require working capital of $61,000 to finance accounts receivable, inventories, and day- to-day cash needs. This working capital would be released at the end of the project's Iife d. The devices would sell for $60 each; variable costs for production, administration, and sales would be $45 per unit e Fxed costs for salaries, maintenance, peoperty taxes, insurance, and straight line depreciation on the equipment would total $155,000 per year (Depreciation is based on cost less salvege value) t To gain rapid entry into the market, the company would have to advertise heavily The advertising costs would be s 78,000 Prey 4of4lll Next here to search 5 8 0 backs