The minton company has gathered the following information for a unit of its most popular product: direct materials $ 7 direct labor 3 overhead (50% variable) 6 cost to manufacture 16 desired markup (50%) 8 target selling price $ 24 the above cost information is based on 5,900 units. a foreign distributor has offered to buy 2,900 units at a price of $19 per unit. this special order would not disturb regular sales. variable shipping and other selling expenses would be an additional $1 per unit for the special order. if the special order is accepted, minton's operating profits will increase by:

Problem 9-5. net present value and taxes [lo 1, 2] penguin productions is evaluating a film project. the president of penguin estimates that the film will cost $20,000,000 to produce. in its first year, the film is expected to generate $16,500,000 in net revenue, after which the film will be released to video. video is expected to generate $10,000,000 in net revenue in its first year, $2,500,000 in its second year, and $1,000,000 in its third year. for tax purposes, amortization of the cost of the film will be $12,000,000 in year 1 and $8,000,000 in year 2. the company’s tax rate is 35 percent, and the company requires a 12 percent rate of return on its films. required what is the net present value of the film project? to simplify, assume that all outlays to produce the film occur at time 0. should the company produce the film?