1. Complete the spreadsheet to estimate the project's annual after-tax cash flows.
2. What is the investment's net present value at a discount rate of 10 percent?
3. What is the investment's internal rate of return?

Facts and Assumptions Equipment initial cost $350,000 Depreciable life yrs. 7 Expected life yrs. 10 Salvage value SO Straight line depreciation EBIT in year 1 $28.000 Tax rate 38% Growth rate in EBIT 3% Discount rate 10% 1 2 3 4 5 6 7 8 9 10 0 350.000 Year Initial cost Annual depreciation EBIT 50.000 50.000 50.000 50.000 50.000 50.000 50.000 28.000 28.840 29.705 30,596 31,514 32.460 33.433 34,436 35,470 36,534