7. North Texas Tech, Inc. is evaluating purchase of new equipment. The equipment has a purchase price of $850,000 and a useful life of 5 years. If purchased, it will be depreciated using 5 year MACRS depreciation. Inventory is expected to increase by $100,000 and accounts payable is expected to increase by $50,000 if this equipment is used, The equipment will allow the firm to increase annual revenue by $440,000. Annual operating costs will increase by $100,000 North Texas Tech expects to sell the equipment for $200,000 at the end of 5 years, The firm's weighted average cost of capital is 12%. The firm's marginal tax rate is 21%. Year 1 23 4 5 16 MACRS % 20% 32% 19.2% 11.52% 11.52% 5.76% (2 points) a. Calculate the initial outlay for this project. b. Calculate the OCF for year 1 (2 points) c. Calculate the net proceeds from the sale of the machine at the end of five years. (3 points) d. What is the non-operating cash flow at the end of year 5 for this project (2 points)