Casey Nelson is a divisional manager for Pigeon Company. His annual pay raises are largely determined by his division's return on investment (ROI), which has been above 20% each of the last three years. Casey is considering a capital budgeting project that would require a $3.500.000 investment in equipment with a useful life of five years and no salvage value. Pigeon Company's discount rate is 16%. All sales are collected in cash, all variable expenses are paid in cash during the year they are incurred, and all out of pocket fixed expenses are paid in cash during the year they are incurred. The project would provide net operating income each year for five years as follows: Sales $3,400,000 1.600.000 Variable expenses 1.800.000 Contribution margin Fixed expenses Advertising, salaries, and other fixed $700,000 out-of-pocket costs Depreciation 700.000 Total fixed expenses 1,400,000 Net operating income $ 400.000 Required: 1 What are the annual net cash inflows for this project? Annual Cash Inflows 2. What are the total cash inflows from this project after 5 years are complete? Total Cash Inflows What is the present value of the cash inflows? (Use Microsoft Excel to calculate present values. Do not round intermediate calculations.) Present Value of Cash Inflows What is the project's net present value? (Use Microsoft Excel to calculate present values. Do not round intermediate calculations.) Net present value What is the project's Internal rate of return? (Use Microsoft Excel to calculate present values. Round your percentage to two decimal places.) Internal rate of return