Case: New Jersey's Kanu Surf Company ships swimwear to Puerto Rico and more Caribbean Islands. 5 years ago they bought a new automatic packaging machine for $ 150,000. The annual costs of operation, maintenance and insurance, as well as the Market value of the machine for each of the 10 years of its useful life is presented in the table below: Year Operation Costs Maintenance Costs Insurance Costs Market Value 1 $16,000 $4,000 $15,000 $80,000 2-10 Increases by $4,000 per year Increases by $3,000 per year Decreases by $1,000 per year Decreases by $5,000 per year Now the company is evaluating the remaining 5 years of its investment to decide the optimal time to replace the machine. Kanu Surf uses 25% as his rate minimum acceptable return after paying income taxes and depreciates your assets using the MACRS method. To make a decision, Kanu Surf want to use inflation in your analysis (the average inflation since they bought the machine so far). Answer and show the procedures as follow: 1. Presumptions that you deem necessary. Case: New Jersey's Kanu Surf Company ships swimwear to Puerto Rico and more Caribbean Islands. 5 years ago they bought a new automatic packaging machine for $ 150,000. The annual costs of operation, maintenance and insurance, as well as the Market value of the machine for each of the 10 years of its useful life is presented in the table below: Year Operation Costs Maintenance Costs Insurance Costs Market Value 1 $16,000 $4,000 $15,000 $80,000 2-10 Increases by $4,000 per year Increases by $3,000 per year Decreases by $1,000 per year Decreases by $5,000 per year Now the company is evaluating the remaining 5 years of its investment to decide the optimal time to replace the machine. Kanu Surf uses 25% as his rate minimum acceptable return after paying income taxes and depreciates your assets using the MACRS method. To make a decision, Kanu Surf want to use inflation in your analysis (the average inflation since they bought the machine so far). Answer and show the procedures as follow: 1. Presumptions that you deem necessary