Global Constructions is evaluating the purchase of new equipment that costs AUD 300,000. The equipment has an estimated useful life of 5 years with a salvage value of AUD 50,000. The expected annual cash flows are:

• Year 1: AUD 80,000
• Year 2: AUD 90,000
• Year 3: AUD 100,000
• Year 4: AUD 110,000
• Year 5: AUD 120,000

Requirements:

1. Determine the depreciation expense using the straight-line method.
2. Calculate the payback period for the equipment.
3. Compute the NPV using a discount rate of 8%.
4. Calculate the Internal Rate of Return (IRR).
5. Advise Global Constructions on whether to purchase the equipment based on your calculations.