An asset in the five-year MACRS property class costs $150,000 and has a zero estimated salvage value after six years of use. The asset will generate annual revenues of $320,000 and will require $80,000 in annual labor and $50,000 in annual material expenses. There are no other revenues and expenses. Assume a tax rate of 40%.

(a) Compute the after-tax cash flows over the project life.

(b) Compute the NPW at MARR = 12%. Is the investment acceptable?