$5)$ You are a Chief Executive Officer of the ACME Corporation. The firm plans to replace new machines to improve the production system costing $$1,129,000.$ The new machines are expected to last five years with a salvage value of $12\%$ of the original cost. During this time, the company will use a $30\%$ CCA rate. The new machines will save $$385,000$ annually before taxes.

The company's required rate of return is $6\%$ and the corporate tax rate is $35\%.$ The new production system requires the firm to increase net working capital by $$850,000.$ Based on the given information, answer questions a and b$.$

a$)$ Please determine the PVCCATS of the purchase based on the given information. Please show all the calculations by which you came up with the final answer. $(3$ Points$)$

b$)$ Please calculate the net present value $($NPV$)$ based on the given information. Please show all the calculations by which you came up with the final answer. $(3$ Points$)$You are a Chief Executive Officer of the ACME Corporation. The firm plans to replace new machines to improve the

production system costing $$1,129,000.$ The new machines are expected to last five years with a salvage value of $12\%$

of the original cost. During this time, the company will use a $30\%$ CCA rate. The new machines will save $$385,000$

annually before taxes.

The company's required rate of return is $6\%$ and the corporate tax rate is $35\%.$ The new production system requires

the firm to increase net working capital by $$850,000.$ Based on the given information, answer questions a and $b.$

a$)$ Please determine the PVCCATS of the purchase based on the given information. Please show all the calculations

by which you came up with the final answer. $(3$ Points$)$

b$)$ Please calculate the net present value $($NPV$)$ based on the given information. Please show all the calculations by

which you came up with the final answer. $(3$ Points$)$