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What is the IRR of the ice cream expansion opportunity for Jack's Food Products? A. 17.20% B. 9.97% C. 13.18% D. 16.25% E16 1 JACK'S FOOD PRODUCTS Ice Cream Opportunity TERMINAL VALUE $ $ 8 9 10 11 12 13 14 Revenue COGS Gross Margin Increase in Advertising and Marketing Increase in Salaries & Wages Increase in Utilities Increase in Other Expenses Tax Effect of Depreciation on Capex Capital Cost of New Equipment CFFA 2019 500,000 $ 125,000 $ 375,000 $ (45,000) $ (120,000) $ 19.000) S 17,000) 195,000 $ (6,500,000) $ (6,111,000) $ 2020 1,250,000 $ 312,500 $ 937,500 $ (50,000) $ (160,000) $ (13,000) $ 17.000) $ 195,000 $ 2021 1,500,000 $ 375,000 $ 1,125,000 $ (55,000) $ (170,000) $ (14,500) $ (7,000) $ 195,000 $ 2022 1,750,000 437,500 1,312,500 160,000) (180,000) (16,000) (7,000) 195,000 $ $ $ $ 902,500 $ 1,073,500 $ 1,244,500 $ 6,844,750 15 16 Discounted Cash flows NPV $236.551 -0.09% 18 IRR What is the IRR of the ice cream expansion opportunity for Jack's Food Products? A. 17.20% B. 9.97% C. 13.18% D. 16.25% E16 1 JACK'S FOOD PRODUCTS Ice Cream Opportunity TERMINAL VALUE $ $ 8 9 10 11 12 13 14 Revenue COGS Gross Margin Increase in Advertising and Marketing Increase in Salaries & Wages Increase in Utilities Increase in Other Expenses Tax Effect of Depreciation on Capex Capital Cost of New Equipment CFFA 2019 500,000 $ 125,000 $ 375,000 $ (45,000) $ (120,000) $ 19.000) S 17,000) 195,000 $ (6,500,000) $ (6,111,000) $ 2020 1,250,000 $ 312,500 $ 937,500 $ (50,000) $ (160,000) $ (13,000) $ 17.000) $ 195,000 $ 2021 1,500,000 $ 375,000 $ 1,125,000 $ (55,000) $ (170,000) $ (14,500) $ (7,000) $ 195,000 $ 2022 1,750,000 437,500 1,312,500 160,000) (180,000) (16,000) (7,000) 195,000 $ $ $ $ 902,500 $ 1,073,500 $ 1,244,500 $ 6,844,750 15 16 Discounted Cash flows NPV $236.551 -0.09% 18 IRR

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