Century Lab plans to purchase a new centrifuge machine for its New Hampshire facility. The machine costs $225,000 and is expected to have a useful life of 10 years, with a terminal disposal value of $3,000. Savings in cash operating costs are expected to be $48,500 per year. However, additional working capital is needed to keep the machine running efficiently. The working capital must continually be replaced, so an investment of $39,000 needs to be maintained at all times, but this investment is fully recoverable (will be "cashed in") at the end of the useful life. Century Lab's required rate of return is 10%. Ignore income taxes in your analysis. Assume all cash flows occur at year-end except for initial investment amounts. Century Lab uses straight-line depreciation for its machines. Present Value of $1 table Present Value of Annuity of $1 table Future Value of $1 table Future Value of Annuity of $1 table Read the requirements Requirement 1. Calculate net present value. (Use factors to three decimal places, X.XXX, and use a minus sign or parentheses for a negative net present value. Enter the net present value of the investment rounded to the nearest whole dollar.) The net present value is $ 50,245 Requirement 2. Calculate internal rate of return. (Use a trial-and-error approach and straight-line interpolation as necessary. Round all present value calculations to the nearest whole dollar and round the IRR to two decimal places, X.XX%.) The internal rate of return (IRR) is 14.03% Requirement 3. Calculate accrual accounting rate of return based on net initial investment. (Round interim calculations to the nearest whole dollar. Round the final rate to two decimal places, X.XX%.) Based on net initial investment, the accrual accounting rate of return (AARR) is 9.96 % Requirement 4. Calculate accrual accounting rate of return based on average investment. (Round interim calculations to the nearest whole dollar. Round the final rate to two decimal places, X.XX%) Based on average investment, the accrual accounting rate of return (AARR) is 17.19% Requirement 5. You have the authority to make the purchase decision. Why might you be reluctant to base your decision on the DCF methods? If your decision is based on the DCF model, the purchase would be made because the net present value is positive and the internal rate of return exceeds the required rate of return. You may be reluctant to purchase the machine if you believe that your performance may actually be measured using accrual accounting in the form of the AARR method based on net initial investment. This approach would show a return on the initial investment that is below the required rate