Elly Balance Company is evaluating a possible Rock Salt Contract. The contract runs 5 years with 23,000 tons to be delivered per year. The revenue per ton is $135 and the variable cost per ton is $105. The machinery will cost $1,490,000 and is to be depreciated using MACRS 5 year class. FC per year are $350,000. After 5 years the equipment can be sold for $105,000 in salvage value. There is an $85,000 investment needed in net working capital that will be recovered in year 5. The required return is 10% and the company tax rate is 36%. 1. Calculate the Annual Cash Flows for the project. 2. Calculate the NPV. 3. Calculate the payback and discounted payback 4. Calculate the IRR and MIRR. 5. Should the company pursue the contract?

Please show complete excel formulas.

UEB Salt Company
State Rock Salt Contract Analysis
Amount of Rock Salt per Year	23,000 Tons
Revenue per Ton	$135
Cost of Equipment	$1,490,000
Life	5
MACRS Class	5
Fixed Cost	$350,000
Var Cost/Ton	$105
Total Var Cost	$2,415,000
Actual Salvage	$105,000
Change in NWC	$85,000
Required Return	10%
Tax Rate	36%
MACRS schedule 5 year class
Year	Depreciation percent
1	0.2
2	0.32
3	0.192
4	0.1152
5	0.1152
6	0.0576
Net Present Value
Payback Period
Discounted Payback Period
IRR
MIRR