Bascilla, Incorporated is trying to determine the value of several projects. Currently there are four being examined: Purchase Latest Project Automation Hire Extra Crew Acquire a Supplier Model of Equipment Initial Cost $ 650,000 $ 91,000 $ 1,200,000 $ 435,000 Salvage Value $ 90,000 N/A N/A $ 133,000 Annual Increase to Net Income $ 64,000 $ 17,000 $ 46,000 $ 46,000 Project Life (years) 10 15 20 8 Hurdle Rate 12% Automation requires a working capital amount to begin which will be released at year 10. The equipment will require a major repair at year 4. Required: Compute the Net Present Value of each project. $ 25,000 $ 48,000 Examine the Internal Rate of Return for each project. Compute the Profitability Index for all projects. Use the PV() function to determine the TVM factors. Be sure to put a "-" sign before the function and for cash out flows, and use "1" as the PMT and FV amounts as necessary. Event Initial Cost Net Income (annual) Depreciation Expense (annual) Working Capital Salvage Value Automation Amount Factor NPV 1.000000 Event Amount Initial Cost Net Income (annual) NPV Hire Extra Crew NPV Factor NPV 1.000000 Event Amount Acquire a Supplier Factor NPV 1.000000 Initial Cost Net Income (annual) Event Initial Cost Net Income (annual) Depreciation Expense (annual) Repair at year 4 Salvage Value NPV Purchase Latest Model of Equipment Amount Factor 1.000000 NPV NPV Which project's IRR is closest to the Hurdle Rate? Which project has an IRR lower than the Hurdle Rate? Use the SUM() function in the calculated NPV charts and the Initial Cost in the original data to compute Profitability Index. Project Profitability Index Automation Hire Extra Crew Acquire a Supplier Purchase Latest Model of Equipment Based on NPV alone, which project is best? Based on Profitability Index alone, which project is best?