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 $479,000 cost with an expected four-year life and a $15,000 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. (PV of $1 EV of $1. PVA of $1, and EVA of S1) (Use appropriate fector(s) from the tables provided.) Expected annual sales of new product Expected annual costs of new product Direct materials Direct labor Overhead (excluding straight-line depreciation on new machine) Selling and administrative expenses Income taxes 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 5. Compute the net present value for this machine using a discount rate of 8% and assuming that cash flows occur at each year-end (Hint Salvage value is a cash inflow at the end of the asset's life.) Complete this question by entering your answers in the tabs below. Required 2 Cash Flow Annual cash flow Residual value Required 1 Required 3 Required 4 Compute the net present value for this machine using a discount rate of 8% and assuming that cash flows occur at each year-end (Hint: Salvage value is a cash inflow at the end of the asset's life.) (Do not round intermediate calculations. Amounts to be deducted should be indicated by a minus sign.) Chart Values are Based on Select Chart Present Value of an Annuity of 1 Present Value of 1 Present value of cash inflows Present value of cash outflows Net present value Required 5 Required 4 S S Amount $1,990,000 455,000 500,000 130,000 179,000 K PV Factor 250.400x 15.000 x 33121- 07350- Present Value S 429.350 11.025 040 375 479.000 361.375 3 S