A B C D E F G H J K L M N P Q R Arnold Inc. is considering to manufacture high-end protein bars for body builders. Sales of protein bars are expected to be $5.4 billion in the first year and to stay constant for 5 years. Total manufacturing costs and operating expenses are 80% of sales, and profits are taxed at 21%. The project requires use of an existing warehouse, which is currently rented out for $150,000 a year. The project requires an upfront investment into machines and other equipment of $2.0 million. The investment can be fully depreciated straight-line over the next 10 years. The firm plans to terminate the project after 5 years and to sell machines and equipment for $500,000. The project requires an initial investment into net working capital equal to 10% of predicted first-year sales. 1. Fill out the table and calculate free cash flows for this project. Year O Year 1 Year 2 Year 3 Year 4 Year 5 Revenues Manufacturing costs and operating expenses Externality Depreciation EBIT Tax expense (21%) Net income Capital expenditures Increase in net working capital Proceeds from sale of equipment Free cash flow 2. If the discount rate is 8%, calculate project's NPV NPV