Home Insert Page Layout Formulas Data Review File View QuickBooks Split 1 View Side by Side Hide Synchronous Scrolling Ruler Formula Bar ormal Paget Page Break Custom(Full R Gridlines. Headings Zoom 100% Zoom to New Arrange Freeze Layout Preview Views Screen Selection Window All Panes Unhide 2 Reset Window Position Workbook Views Show Window C47 In cell D37, by using cell references, calculate the project's internal rate of return. Use the Excel The Shome Corporation, a firm in the 34 percent marginal tax bracket with a 15 percent required rate of retura or discount rate, is considering a new project. This project involves the introduction of a new product. This project is expected to last five years and then, because this is somewhat of a fad project, it will be terminated Given the following infonmation, determine the net cash flows associated with the project, the project's net present value, the profitability index, and the intermal rate of return Apply the appropriate decision criteria. Cost of new plant and equipment: $6,900,000 Shipping and installation costs: 100,000 Sales price per unit: $250/unit in Years 1-4, $200/unit in Year 5 Variable cost per nit:$130it Annual fixed costs: $300,00 Working capital requirements: There will be an initial working capital requirement of $100,000 just to get production started. For each year, the total investment in net working capital will be equal to 10 percent of the dollar value of sales for that year. Thais, the investment in working capital will increase during Years 1 through 3 then decrease in Year 4. Finally, all working capital is liquidated at the termination of the project at the end of Year 5 isia e fi aalc aer fie ears Initial capital expenditure Shipping and installation costs Life of the initial expenditure Marginal tax rate Discount rate Net working capital (% of Sales) Net working capital investinent( Fixed costs per year Sales price (1-4) Sales price (S) Variable cost of product -($6,900,000.00) $100,000,00) 34.00% . 15.0 10.00% (5100,000.00) 53M),000.0) S250.00 $200.00 Year 0 Year 1 Year 2 Year Year 4 Year S 12-24