Devon Corporation uses a discount rate of $8\%$ in Its capital budgeting. Partlal analysis of an Investment In automated

equipment with a useful life of $8$ years has thus far ylelded a net present value of $-$$$496,541.$ This analysis did not

Include any estimates of the intangible benefits of automating this process nor did it include any estimate of the salvage

value of the equlpment. $($Ignore income taxes.$)$

Click here to vlew Exhiblt $14$B$-1$ and Exhiblt $14$B$-2,$ to determine the approprlate discount factor$($s$)$ using the tables

provided.

Required:

a$.$ Ignoring any salvage value, how large would the additional cash flow per year from the Intanglble benefits have to be

to make the Investment in the automated equipment financlally attractive?

b$.$ Ignoring any cash flows from Intanglble benefits, how large would the salvage value of the automated equipment

have to be to make the Investment in the automated equipment financlally attractive?Devon Corporation uses a discount rate of $8\%$ in its capital budgeting. Partial analysis of an investment in automated equipment with a useful life of $8$ years has thus far yielded a net present value of $$$$496,541.$ This analysis did not include any estimates of the intangible benefits of automating this process nor did it include any estimate of the salvage value of the equipment. $($Ignore income taxes.$)$

Click here to view Exhibit $14$B$-1$ and Exhibit $14$B$-2,$ to determine the appropriate discount factor$($s$)$ using the tables provided.

Required:

Ignoring any salvage value, how large would the additional cash flow per year from the intangible benefits have to be to make the investment in the automated equipment financially attractive?

Ignoring any cash flows from intangible benefits, how large would the salvage value of the automated equipment have to be to make the investment in the automated equipment financially attractive?