ased on the information provided below, Should the company proceed with the invest PV & IRR to evaluate the project Asset cost $150,000 10 years 15 years $15,000 S500,000 $6,000 $20,000 Age of machine $180,000 o years Useful Life Salvage value 5 years $550,000 Maintenance cost $10,000 $25,000 $6,000 $2,000 $12,000 Electricity cost Shipping cost Freight insurance Working capital: Cash $25,000 Trade debtors $30,000 24,000 $40,000 S10,000 $8,919 $46,435 10.75% $7,539 S16,458 Inventory $34,000 Trade creditors Accruals $15,000 $15,977 $84,022 11.25% S11,250 $27,227 Current portion of long-term Loan Long-term Loan (non-current portion) Interest rate Interest Expense Instalment payment Depreciation is on straight-line method. The current machine can be sold today for $75,000. The new machine can reduce labour by cutting cost from $36,000 to $30,000 a year. The estimated selling price of the new machine at the end of its useful life is $35,000. Should company proceed with the replacement, they have to use their other factory lot now leased to a third party for $700 per month. The company spent $30,000 on rewiring/renovation of the factory now leased to the third party. It is expected that only 90% ofcompany's investment in working capital will be recovered. Company's tax rate is 40% and its wACC is 11.00% 13 ased on the information provided below, Should the company proceed with the invest PV & IRR to evaluate the project Asset cost $150,000 10 years 15 years $15,000 S500,000 $6,000 $20,000 Age of machine $180,000 o years Useful Life Salvage value 5 years $550,000 Maintenance cost $10,000 $25,000 $6,000 $2,000 $12,000 Electricity cost Shipping cost Freight insurance Working capital: Cash $25,000 Trade debtors $30,000 24,000 $40,000 S10,000 $8,919 $46,435 10.75% $7,539 S16,458 Inventory $34,000 Trade creditors Accruals $15,000 $15,977 $84,022 11.25% S11,250 $27,227 Current portion of long-term Loan Long-term Loan (non-current portion) Interest rate Interest Expense Instalment payment Depreciation is on straight-line method. The current machine can be sold today for $75,000. The new machine can reduce labour by cutting cost from $36,000 to $30,000 a year. The estimated selling price of the new machine at the end of its useful life is $35,000. Should company proceed with the replacement, they have to use their other factory lot now leased to a third party for $700 per month. The company spent $30,000 on rewiring/renovation of the factory now leased to the third party. It is expected that only 90% ofcompany's investment in working capital will be recovered. Company's tax rate is 40% and its wACC is 11.00% 13