complete all parts

on op A bicycle manufacturer currently produces 217.000 unts a year and expects output levels to remain steady in the future. It buys chains from an outside supplier at a price of $2.10 a chain. The plant manager believes that it would be cheaper to make these chains rather than buy them. Direct in-house production costs are estimated to be only $1.60 per chain. The necessary machinery would cost $277.000 and would be obsolete after ten years. This investment could be depreciated to moro for tax purposes using a year straight-ine depreciation schedule. The plant manager estimates that the operation would require 550,000 o inventory and other working capitalulront year), but argues that this sum can be ignored since it is recoverable at the end of the ten years. Expected proceeds from scrapping the machinery har ten years are $20.775 If the company Days tax at a rate of 5% and the opportunity cost of capital is 15%, what is the represent value of the decision to produce the chains in house instead of purchasing them from the suppler? Project the annual free cash flows (FCF) of buying the chains The annual tree cash flows for years 1 to 10 of buying the chaine is Round to the nearest dolor. Enter a free cash out fow is igative number) Compute the NPV of buying the chains from the FCF The NPV or buying the chaine from a PCFoRound to the nature dolor Enter a negative NPV seterumber) Com the initial FCF of producing the chains. The two of trodde hecho Hound to the nearest dotat Enter a trocah outlow as a negative number) Com aror in your rough of producing the chains The Pin years through of producing the chains Round to the nearest dolor. Under free ch tow as a negative number) Computer FCF in year 10 of producing the chains The royar 10 of producing the compound to the nearest dotar or a free chat outlow as a negative number) Compute the NIV of producing the chains from the FCF The NPV et producing the chains from we FO3 Round to the nearest dolur. Enter a negative NPV as a negative number) Compute the difference between the nel present we found above The present value of producing the chains in house intend of purchasing them from the supplier Round to the nearest dolar) Enter your answer in each of the rower box on op A bicycle manufacturer currently produces 217.000 unts a year and expects output levels to remain steady in the future. It buys chains from an outside supplier at a price of $2.10 a chain. The plant manager believes that it would be cheaper to make these chains rather than buy them. Direct in-house production costs are estimated to be only $1.60 per chain. The necessary machinery would cost $277.000 and would be obsolete after ten years. This investment could be depreciated to moro for tax purposes using a year straight-ine depreciation schedule. The plant manager estimates that the operation would require 550,000 o inventory and other working capitalulront year), but argues that this sum can be ignored since it is recoverable at the end of the ten years. Expected proceeds from scrapping the machinery har ten years are $20.775 If the company Days tax at a rate of 5% and the opportunity cost of capital is 15%, what is the represent value of the decision to produce the chains in house instead of purchasing them from the suppler? Project the annual free cash flows (FCF) of buying the chains The annual tree cash flows for years 1 to 10 of buying the chaine is Round to the nearest dolor. Enter a free cash out fow is igative number) Compute the NPV of buying the chains from the FCF The NPV or buying the chaine from a PCFoRound to the nature dolor Enter a negative NPV seterumber) Com the initial FCF of producing the chains. The two of trodde hecho Hound to the nearest dotat Enter a trocah outlow as a negative number) Com aror in your rough of producing the chains The Pin years through of producing the chains Round to the nearest dolor. Under free ch tow as a negative number) Computer FCF in year 10 of producing the chains The royar 10 of producing the compound to the nearest dotar or a free chat outlow as a negative number) Compute the NIV of producing the chains from the FCF The NPV et producing the chains from we FO3 Round to the nearest dolur. Enter a negative NPV as a negative number) Compute the difference between the nel present we found above The present value of producing the chains in house intend of purchasing them from the supplier Round to the nearest dolar) Enter your answer in each of the rower box