Hummer Seed Company You have been hired as the financial administrator of Hummer Corp . , an agricultural seed broker in Northern Utah , Mr . Bullen , the president has asked you to decide whether or not the company should purchase for $450,090 a warehouse and the seed distribution rights for a major seed producer , for farms extending from Idaho into Oregon . If the regional sales area is expanded it is estimated that an investment of $100 000 in working capital will be required . The company expects to operate in the expanded area for 10 years after which time they anticipate being able to sell the rights for $600 000 Sales revenues are forecast at $409 000 per year for five years , and 5300 000 per year thereafter Operating expenses will be $50 000 annually and cost of goods sold amount to 60% of sales The full cost of the warehouse and regional sales area will be depreciated on a straight line basis over 10 year If the firm acquires the assets in question it will be able to dispose of certain fixed assets that it presently owns . These have a net book value of $40,090 a remaining ( straight line ) depreciabl life of 4 years , and could be sold for $30 900 Mr . Bullen estimates the required rate of return for Hummer to be 14 percent . Assume a corporate income tax rate of 30 percent with a capital gains rate of 15% Complete a NPV and IRR analysis on the project and answer the questions on CANVAS