Engr Econ Assignment- Capital Budgeting metrics with pre-tax and after-tax cash flows. Pluskwik Manufacturing is considering purchasing a new production machine. The equipment will cost $150,000 and have a 3-year useful life. Expected salvage value is $20,000 at the end of year 3. Tax regulations permit the following depreciation schedule: Depreciation - Percent of Cost Deduction - similar to the IRS MACRS method Year 1 2 3 20% 32 19 15 14 4 5 Year The company's tax rate is 15% and its MARR 15 2%. The equipment is expected to generate the following cash savings and cash expenses: Cash Savings New Variable Expenses New Fixed Expenses ( not including depo $11,000 $10,000 $1,000 each year of the asset's life $13,000 $10,000 1 2 3 $13,000 $12,000 Cash Savings New Variable Expenses New Fixed Expenses (not including Year depr) $10,000 $11,000 1 $1,000 each year of the asset's life N $13,000 $10,000 $13,000 $12,000 By producing new products from this machine, the company also expects to sell 5,000 units at $10 each for each and every year that this machine is running. Questions: 1) Prepare a timeline presenting the cash flows relevant to this proposal. 2) Determine the following on a pre-tax cash basis: payback period and net present value