1 Laurman, Inc. is considering the following project: 2Required investment in equipment Project life 4 Sae value 1,750,000 5 years 225,000 6 The project would provide net operating income each year as follows: 7 Sales 8 Variable expenses 9Contribution margin 10 Fixed expenses: 11ries, rent and other fixed out-of pocket costs 12 10 2,750,000 600,000 1,150,000 eBook 520,000 Ask Depreciation 350,000 13 Total fixed expenses 14 Net operating income 15 16 Cost of Capital 17 18% 18 1. Compute the annual net cash inflow from the project 19 630,000 20 2. Complete the following timeline to compute the net present value of the future cash flows for this project. Don't forget to include the salvage value in year 5 21 Year 0 23 Net cash flow Sheet1 202. Complete the following timeline to compute the net present value of the future cash flows for this project. Don't forget to include the salvage value in year 5. 21 Year 0 23 Net cash flow 24 Discount Factor 1/(1+r)n) 25 Present value of the cash flows 26 Net present value 27 1.000 Ints 283. Use Excel's NPV function to compute the present value of the cash flows from years 1-5. Do not include the original investment at time zero 29 NPV of Cash Flows from Years 1-5 30 Deduct the cost of the investment 1 Net present value 32 Write an if/then statement to ACCEPT or REJECT the project based on NPV 34 4. Use Excel's IRR function to compute the project's internal rate of return 85 Write an if/then statement to ACCEPT or REJECT the project based on IRR 36 37 5. Compute the project's payback period 38 39 6. Compute the project's accounting rate of return. 40 41 years