4. Javanka Industries is considering purchasing a new milling machine from Russia that costs $150,000. The machines installation and shipping costs will total $10,000. If accepted, the milling machine project will require an initial net working capital investment of $30,000 (all working capital will be returned at the end of the project). Javanka plans to fully depreciate the machine on a straight-line basis over a period of eight years (the length of the project). An additional working capital investment of $20,000 will need to be made during year 3. The new milling machine will allow for incremental revenue of $85,000 in year 1, growing 8% (compounded) for the length of the project. This extra revenue will require extra expenses (excluding depreciation) of $40,000 in year 1, growing 5% (compounded) for the length of the project. The firms marginal tax rate is 40%. At the end of the project the milling machine will be sold for $60,000. Calculate the net investment and the net after-tax cash flows of the project for each year.

Calculate the net present value, the profitability index, the payback period, and the discounted payback period of the Javanka project in question #4. Assume the cost of capital is 12%. Is the IRR higher or lower than 12%? Should the project be completed?

Please show work as well step by step, you can use excell thank you