Loni owns a software company and has a great idea for a new app. in order to build the app, she will need to hire a computer expert for one year at a salary of $87,000. (assume this is the only expense required to create this app.) however, she expects to make $99,000 by selling the app. since loni does not have any extra cash on hand, she goes to the bank, where they offer to lend her $87,000 with an annual interest rate of 15%. should loni take the loan and build the app?

Sailcloth & more currently produces boat sails and is considering expanding its operations to include awnings for homes and travel trailers. the company owns land beside its current manufacturing facility that could be used for the expansion. the company bought this land 5 years ago at a cost of $319,000. at the time of purchase, the company paid $24,000 to level out the land so it would be suitable for future use. today, the land is valued at $295,000. the company has some unused equipment that it currently owns valued at $38,000. this equipment could be used for producing awnings if $12,000 is spent for equipment modifications. other equipment costing $490,000 will also be required. what is the amount of the initial cash flow for this expansion project?