Parameters is to be performed on before-tax basis

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The architectural and engineering estimate of $3,750,000 for the building is believed to be accurate, as is the estimates of $225,000 for annual operating and maintenance costs and $750,000 for existing equipment. However, it is felt that the estimate for $4,250,000 for the new automated warehouse equipment and the labor savings estimate of 70 employees are subject to error. A sensitivity analysis for these two parameters is to be performed on a before-tax basis.

Reference no: EM131104611

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