A beauty product company is developing a new fragrance named Happy Forever. There is a probability of 0.3 that consumers will love Happy Forever, and in this case, annual sales will be 1 million bottles; a probability of 0.4 that consumers will find the smell acceptable and annual sales will be 200,000 bottles; and a probability of 0.3 that consumers will find the smell weird and annual sales will be only 50,000 bottles. The selling price is $41, and the variable cost is $7 per bottle. There is a fixed production cost of $800,000 per year, and depreciation costs are $1.2 million. Assume that the marginal tax rate is 40 percent.
The expected annual incremental after tax cash flows from the new fragrance are $