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Help Save & Exit Sandscrawler Delivery is a small company that transports Kyber crystals between Lothaland Bespin. It operates a fleet of small transport ships

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Help Save & Exit Sandscrawler Delivery is a small company that transports Kyber crystals between Lothaland Bespin. It operates a fleet of small transport ships that moves crystals to and from a central depot within each planet and uses a common carrier to deliver the crystals between the depots on the two planets. Sandscrawler Delivery recently acquired approximately $63 million of cash capital from its owners, and its president, Lando Calrissian, is trying to identify the most profitable way to invest these funds Huey Solo, the company's operations manager believes that the money should be used to expand the fleet of transport ships at a cost of $690,000. He argues that more ships would enable the company to expand its services into new markets thereby increasing the revenue base. More specifically, he expects cash intlows to increase by $110.000 per year. The additional ships are expected to have an average useful life of four years and a combined salvage value of $96.000. Operating the ships will require additional working capital of $35,000, which will be recovered at the end of the fourth year In contrast. Luke Skywalket, the company's chief accountant, believes that the funds should be used to purchase a freighter to deliver the crystals between the depots in the two cities. The conversion process would produce continuing improvement in operating Savings and reduce cash outflows as follows 5-14 3157,000 Year 2 Wear 1920,000 $999.000 The large freighters are expected to cost $770,000 and to have a four-year useful ife and a 588.000 salvage value. In addition to the purchase price of the freelghters, up front pilot training costs are expected to amount to $15.000 Sandscrawler Delivery management has established a 16 percent desired rate of return (Stand PVALS1) (Use appropriate factor(s) from the tables provided.) Required 0.8b. Determine the net present value and present value Index for each investment alternative Round your intermediate calculations and final answers to 2 decimal places. Enter your answer in whole dollars and not in millions) Purchase of Purchase of Transport Ships # Net Present ou NPV) D Present index (PV)

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