Factor Company is planning to add a new product to its line. To manufacture this product, the company needs to buy a new machine at a $$482,000$ cost with an expected four$-$year life and a $$16,100$ salvage value. All sales are for cash, and all costs are out of pocket except for depreciation on the new machine. Additional information includes the following. $($FV of $$1,$ PV of $$1,$ FVA of $$1,$ PVA of $$1,$ FVAD of $$1$ and PVAD of $$1)($Use appropriate factor$($s$)$ from the tables provided.$)$

Expected annual sales of new product $ $1,880,000$

Expected annual costs of new product

Direct materials $480,000$

Direct labor $672,000$

Overhead excluding straight$-$line depreciation on new machine $337,000$

Selling and administrative expenses $141,000$

Income taxes $36\%$

Required:

$1.$

Compute straight$-$line depreciation for each year of this new machine$$s life.

$2.$

Determine expected net income and net cash flow for each year of this machine$$s life.

$3.$

Compute this machine$$s payback period, assuming that cash flows occur evenly throughout each year.

$4.$

Compute this machine$$s accounting rate of return, assuming that income is earned evenly throughout each year.