Briggs Excavation Company is planning an investment of $2,005,700 for a bulldozer. The bulldozer is expected to operate for 4,000 hours per year for 10 years. Customers will be charged $150 per hour for bulldozer work. The bulldozer operator costs $26 per hour in wages and benefits. The bulldozer is expected to require annual maintenance costing $40,000. The bulldozer uses fuel that is expected to cost $34 per hour of bulldozer operation. Present Value of an Annuity of $1 at Compound Interest 6% 0.943 1.833 2.673 3.465 4.212 4.917 5.582 6.210 6.802 7.360 10% 0.909 1.736 2.487 3.170 3.791 4.355 4.868 5.335 5.759 6.145 15% 0.870 1.626 2.283 2.855 3.353 3.785 4.160 4.487 4.772 5.019 2090 0.833 1.528 2.106 2.589 2.991 3.326 3.605 3.837 4.031 4.192 Year 1290 0.893 1.690 2.402 3.037 3.605 2 4 5 6 7 8 4.564 4.968 5.328 5.650 10 a. Determine the equal annual net cash flows from operating the bulldozer. Use a minus sign to indicate cash outflows. Briggs Excavation Company Equal Annual Net Cash Flows Cash inflows: Hours of operation Labor cost per hour x Revenue per year Cash outflows: Maintenance costs per year x 4,000 150 600,000 V 40.000 | X Fuel cost per hour Labor cost per hour Revenue per hour Revenue per year x 34 V X$ 4,000 X Maintenance costs per year Annual net cash flows 20,000 V b. Determine the net present value of the investment, assuming that the desired rate of return is 10%. Use the present value of an annuity of $1 table above. Round to the nearest dollar. If required, use the minus sign to indicate a negative net present value. / 1,966,40 2,005,70 V -39,300V Present value of annual net cash flows Amount to be invested Net present value c. Should Briggs Excavation invest in the bulldozer, based on this analysis? No ,because the bulldozer cost is less than X the present value of the cash flows at the minimum desired rate of return of 10%. d. Determine the number of operating hours such that the present value of cash flows equals the amount to be invested. Round interim calculations and final answer to the nearest whole number. 3,696X hours