a. Determine the incremental earnings from the purchase of the XC-750. b. Determine the free cash flow from the purchase of the XC-750. c. If the appropriate cost of capital for the expansion is 10.2%, compute the NPV of the purchase. d. While the expected new sales will be $10.05 million per year from the expansion, estimates range from $8.15 million to $11.95 million. What is the NPV in the worst case? In the best case? e. What is the break-even level of new sales from the expansion? What is the breakeven level for the cost of goods sold? f. Billingham could instead purchase the XC-900, which offers even greater capacity. The cost of the XC-900 is $3.94 million. The extra capacity would not be useful in the first two years of operation, but would allow for additional sales in years 3 through 10. What level of additional sales (above the $10.05 million expected for the XC-750) per year in those years would justify purchasing the larger machine? Incremental Effects Year Sales Revenues Cost of Goods Sold S, G, and A Expenses Depreciation EBIT Taxes at 35% Unlevered Net Income a. Determine the incremental earnings from the purchase of the XC-750. b. Determine the free cash flow from the purchase of the XC-750. c. If the appropriate cost of capital for the expansion is 10.2%, compute the NPV of the purchase. d. While the expected new sales will be $10.05 million per year from the expansion, estimates range from $8.15 million to $11.95 million. What is the NPV in the worst case? In the best case? e. What is the break-even level of new sales from the expansion? What is the breakeven level for the cost of goods sold? f. Billingham could instead purchase the XC-900, which offers even greater capacity. The cost of the XC-900 is $3.94 million. The extra capacity would not be useful in the first two years of operation, but would allow for additional sales in years 3 through 10. What level of additional sales (above the $10.05 million expected for the XC-750) per year in those years would justify purchasing the larger machine? Incremental Effects Year Sales Revenues Cost of Goods Sold S, G, and A Expenses Depreciation EBIT Taxes at 35% Unlevered Net Income