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Facts
· A new project proposes the addition of a Super line of deserts with a capital cost of $200,000: $120,000 for machinery and equipment, and $80,000 for modifications on existing facilities.
· General Foods expects Super to capture 10% of the total desert market; Eighty percent is expected to come from growth in market share while the remaining 20% would come from the erosion of General Food Corporation Jell-O sales.
· A Jell-O agglomerator, which is currently operating under capacity, will be used to process the Super line.
· The capital budget manual requires that the Super project be evaluated using the payback method and a return on funds employed (ROFE).
Approximate Word count = 546
Approximate Pages = 2.2
(250 words per page double spaced)
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