Problem 9-17b Question Help You are a manager at Northern Fibre, which is considering expanding its operations in synthetic fibre manufacturing. Your boss comes into your office, drops a consultant's report on your desk, and complains, "We owe these consultants $1.9 million for this report, and I am not sure their analysis makes sense. Before we spend the $17 million on new equipment needed for this project, look it over and give me your opinion." You open the report and find the following estimates (in millions of dollars): 1 2 9 10 Sales revenue 34.000 34.000 34.000 34.000 Cost of goods sold 20.400 20.400 20.400 20.400 Gross profit 13.600 13.600 13.600 13.600 General, sales, and administrative expenses 1.360 1.360 1.360 1.360 - Depreciation 1.700 1.700 1.700 1.700 = Net operating income 10.5400 10.5400 10.5400 10.5400 Income tax 3.689 3.689 3.689 3.689 = Net income 6.851 6.851 6.851 6.851 b. If the cost of capital for this project is 14%, what is your estimate of the value of the new project? Value of project = 5 million (Round to three decimal places.)