5. Far-out Airfreight Inc. has asked you to recommend a new automatic parcel sorter, You have obtained the following mutually exclusive bids: SHIP-R SORT-OF U-SORT-M Initial Cost $185,000 $231,000 $178,000 Salvage Value 39,100 43,500 14,400 Annual Benefit 72,500 85,000 69,700 Yearly maintenance and operating costs 20,100 21,000 13,400 Useful life (years) 7 7 7

a. Using a MARR of 12%, determine the net present value of each alternative. Please report to the nearest dollar.

b. What is the internal rate of return (IRR) of each alternative? Please report to the tenths decimal place.

c. Based solely on the results of 5 a. and 5 b., and a MARR of 12%, which alternative(s) would you select and why (do nothing is a fourth alternative)?

Please dont use excel so I can see how you did it