6. please show your solution

6 An auto-parts producer is considering buying a new material handling system which has a purchase price of $170,000, a useful life and MACRS class life of 5 years, and a salvage value of $10,000. The system will allow the company to save an amount of $100,000 each year due to a lower use of electric power and labor. The company has a tax rate of 35%. The Initial investment will be financed with 30% equity and 70% debt. The interest rate on both short-term and long-term financing is 13% and the loan is to be repaid in equal annual amounts over the project life Click the icon to view the MACRS depreciation schedules. Click the icon to view the interest factors for discrete compounding when i 13% per year. Click the icon to view the interest factors for discrete compounding when i 21% per year (a) Prepare income and cashflow statements in table format and determine the after-tax cash fows below. (Round to the nearest dollar.) Net Cash Flow Period 0 1 $ 2 3 $ $ $ S 4 5 (b) Under a MARR of 21%, the net present worth of the project is $ (Round to the nearest dollar) Therefore, the project (1) be accepted (c) The Internal rate of retum (IRR) of the project is %. (Round to two decimal places. Therefore, it (2) be accepted 7: More Info 10 15 Class Depreciation rate Yoarn 200% 200% 200% 200% 150% 150% 33 33 1429 24.49 17 49 10.00 18.00 44.45 5.00 9.50 8.55 3.750 7219 6.677 3 14.40 14.81 7.41 32.00 19.20 11.52 11.52 5.76 11.52 7.70 6.177 12.49 8.93 8.92 9.22 737 7 8.93 4.46 5.713 5285 4.888 4.522 4.462 4.461 6.55 6.55 6.56 6.55 3.28 9 10 11 12 13 6.93 6.23 5.90 5.90 5.91 5.90 5.91 5.90 5.91 5.90 5.91 2.95 4.462 4.461 14 15 16 17 4 462 4.461 4.462 4.461 4.462 4.461 4.462 18 4.487 19 20 21 Year to switch from declining balance 2.231 straight line 8. More Info N 1 Single Payment Compound Present Amount Worth Factor Factor (F/P.,,N) (PMF, IN 1.1300 12769 0.7831 1.4429 0.6931 1.6305 0.6133 1.8424 0.5428 0.8850 Compound Amount Factor (F/A, IN) 1.0000 2.1300 3.4069 4.8498 6.4803 Equal Payment Series Sinking Present Fund Worth Factor Factor (A/F, IN (PIAN) 1.0000 0.8850 0.4695 1.6681 0.2935 23612 0.2062 2.9745 0.1543 35172 Capital Recovery Factor (AP, N) 1.1300 0.5995 0.4235 0.3362 02843 2 3 4 5 3.9975 7 44226 8 2.0820 2 3528 2 6584 3.0040 3.3946 0.4803 0.4251 0.3762 0.3329 0.2946 8.3227 10.4047 12.7573 15.4157 18 4197 0.1202 0.0961 0.0784 0.0649 0.0543 0.2502 02261 0.2084 0.1949 0.1843 4.7988 5.1317 5.4262 9 10 9. 9: More Info Factor Single Payment Compound Present Amount Worth Factor Factor (F/P.I.N) (P/F, 1, N) 1.2100 0.8264 1.4641 0.6830 1.7716 0.5645 2.1436 0.4665 2.5937 0.3855 Compound Amount Factor (F/A,,N 1.0000 2.2100 3.6741 5.4457 7.5892 Equal Payment Series Sinking Present Fund Worth Factor (A/F, LN) (P/A, IN) 1.0000 0.8264 0.4525 1.5095 0.2722 2.0739 0.1830 2.5404 0.1318 29200 Capital Recovery Factor (APAN 12100 0.6625 0.4822 0.3930 0.3418 7 3.1384 3.7975 4.5950 5.5599 6.7275 0.3186 0.2633 0.2176 0.1790 8 10 1630 13.3214 17.1189 21.7139 27 2738 0.0982 0.0751 0.0584 0.0461 0.0367 3.2446 3.5079 3.7256 3.9054 4.0541 0.3082 0.2851 0.2684 0.2561 02467 9 10 0.1486 (1) O should should not (2) O should should not 6 An auto-parts producer is considering buying a new material handling system which has a purchase price of $170,000, a useful life and MACRS class life of 5 years, and a salvage value of $10,000. The system will allow the company to save an amount of $100,000 each year due to a lower use of electric power and labor. The company has a tax rate of 35%. The Initial investment will be financed with 30% equity and 70% debt. The interest rate on both short-term and long-term financing is 13% and the loan is to be repaid in equal annual amounts over the project life Click the icon to view the MACRS depreciation schedules. Click the icon to view the interest factors for discrete compounding when i 13% per year. Click the icon to view the interest factors for discrete compounding when i 21% per year (a) Prepare income and cashflow statements in table format and determine the after-tax cash fows below. (Round to the nearest dollar.) Net Cash Flow Period 0 1 $ 2 3 $ $ $ S 4 5 (b) Under a MARR of 21%, the net present worth of the project is $ (Round to the nearest dollar) Therefore, the project (1) be accepted (c) The Internal rate of retum (IRR) of the project is %. (Round to two decimal places. Therefore, it (2) be accepted 7: More Info 10 15 Class Depreciation rate Yoarn 200% 200% 200% 200% 150% 150% 33 33 1429 24.49 17 49 10.00 18.00 44.45 5.00 9.50 8.55 3.750 7219 6.677 3 14.40 14.81 7.41 32.00 19.20 11.52 11.52 5.76 11.52 7.70 6.177 12.49 8.93 8.92 9.22 737 7 8.93 4.46 5.713 5285 4.888 4.522 4.462 4.461 6.55 6.55 6.56 6.55 3.28 9 10 11 12 13 6.93 6.23 5.90 5.90 5.91 5.90 5.91 5.90 5.91 5.90 5.91 2.95 4.462 4.461 14 15 16 17 4 462 4.461 4.462 4.461 4.462 4.461 4.462 18 4.487 19 20 21 Year to switch from declining balance 2.231 straight line 8. More Info N 1 Single Payment Compound Present Amount Worth Factor Factor (F/P.,,N) (PMF, IN 1.1300 12769 0.7831 1.4429 0.6931 1.6305 0.6133 1.8424 0.5428 0.8850 Compound Amount Factor (F/A, IN) 1.0000 2.1300 3.4069 4.8498 6.4803 Equal Payment Series Sinking Present Fund Worth Factor Factor (A/F, IN (PIAN) 1.0000 0.8850 0.4695 1.6681 0.2935 23612 0.2062 2.9745 0.1543 35172 Capital Recovery Factor (AP, N) 1.1300 0.5995 0.4235 0.3362 02843 2 3 4 5 3.9975 7 44226 8 2.0820 2 3528 2 6584 3.0040 3.3946 0.4803 0.4251 0.3762 0.3329 0.2946 8.3227 10.4047 12.7573 15.4157 18 4197 0.1202 0.0961 0.0784 0.0649 0.0543 0.2502 02261 0.2084 0.1949 0.1843 4.7988 5.1317 5.4262 9 10 9. 9: More Info Factor Single Payment Compound Present Amount Worth Factor Factor (F/P.I.N) (P/F, 1, N) 1.2100 0.8264 1.4641 0.6830 1.7716 0.5645 2.1436 0.4665 2.5937 0.3855 Compound Amount Factor (F/A,,N 1.0000 2.2100 3.6741 5.4457 7.5892 Equal Payment Series Sinking Present Fund Worth Factor (A/F, LN) (P/A, IN) 1.0000 0.8264 0.4525 1.5095 0.2722 2.0739 0.1830 2.5404 0.1318 29200 Capital Recovery Factor (APAN 12100 0.6625 0.4822 0.3930 0.3418 7 3.1384 3.7975 4.5950 5.5599 6.7275 0.3186 0.2633 0.2176 0.1790 8 10 1630 13.3214 17.1189 21.7139 27 2738 0.0982 0.0751 0.0584 0.0461 0.0367 3.2446 3.5079 3.7256 3.9054 4.0541 0.3082 0.2851 0.2684 0.2561 02467 9 10 0.1486 (1) O should should not (2) O should should not