You are evaluating a project for The Ultimate recreational tennis racket, guaranteed to correct that wimpy backhand. The project has a 3-year life. You estimate the revenue for the next three years are as follows: $400,000 in year 1, $500,000 in year 2, and $530,000 in year 3. The cash expenses are expected to be $325,000 in year 1, $381,250 in year 2, and $398,125 in year 3. The project requires an initial investment of $165,000, which is depreciated straight-line to zero over the 3 year project life. The actual market value of the initial investment at the end of year 3 is $35,000. Initial net working capital investment is $75,000 (at year 0) and NWC will maintain a level equal to 20% of sales each year thereafter. The tax rate is 34% and the required return on the project is 10%. What is EBIT for the project in the first year? a. $ 20,000 b. $ 75,000 c. $113,750 d. $175,000 e. None of the above