(Ignore income taxes in this problem.) A company has provided the following data concerning a proposed project: The annual cost savings must be closest to:

A) $4,024
B) $2,436
C) $1,875
D) $3,704

Question

(Ignore income taxes in this problem.) A company has provided the following data concerning a proposed project:   The annual cost savings must be closest to:A) $4,024B) $2,436C) $1,875D) $3,704

Noreen Reid-Johnson · Accepted Answer

Final Answer : B, Explanation :  To find the annual cost savings, we need to subtract the annual cost of the project from the annual revenue generated by the project.Annual revenue = $72,000Annual cost = $54,564Annual cost savings = Annual revenue - Annual cost= $72,000 - $54,564= $17,436Out of the given options, choice B, $2,436, is the closest to $17,436.   $1,300 = -$10,000 + 4.639XX = $11,300 ÷ 4.639 = $2,436 (rounded)

(Ignore income taxes in this problem.) A company has provided the following data concerning a proposed project: The annual cost savings must be closest to:

A) $4,024
B) $2,436
C) $1,875
D) $3,704

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Learning Objectives

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