An ice-cream company has a new business idea: specially equipped ice-cream trucks can deliver the company's ice-creams to customers' homes and create custom ice-cream flavors right there. Seems like $850,000would need to be invested right away to buy the right delivery trucks. This project would be tested for 10 years, and at the end of the project all used trucks will be sold and bring the company estimated $190,000 in the after-tax salvage value. The company would also need to set aside $13,000 in cash right away to cover any unforeseen future repairs, and additional $3,000 would be added each year to this cash reserve. The cash reserve will be recovered at the end of the project. The company expects that $170,000 would be generated each year as the operating cash flow.

If the company doesn't take any loan, the required return on this project will be 15%, and it'll be used to discount all future estimated cash flows.

If the company does take a loan, it will be an interest-only loan, at 4.0% annual rate, and it will be used to pay for 50% of the initial investment such as the delivery trucks.

Calculate unlevered cash flows for this project. Signs are important!

• Year 0 cash flow = $ [ Select ] ["-863,000", "-850,000", "-837,000", "167,000", "170,000", "173,000", "360,000", "373,000", "400,000", "403,000"]
• Cash flow in the intermediate year (for each year) = $ [ Select ] ["-863,000", "-850,000", "-837,000", "167,000", "170,000", "173,000", "360,000", "373,000", "400,000", "403,000"]
• Cash flow in the final year = $ [ Select ] ["-863,000", "-850,000", "-837,000", "167,000", "170,000", "173,000", "360,000", "373,000", "400,000", "403,000"]