I have no idea how to calculate this!! Please help!!!

Billingham Packaging is considering expanding its production capacity by purchasing a newmachine, theXC-750. The cost of theXC-750 is $2.77 million.Unfortunately, installing this machine will take several months and will partially disrupt production. The firm has just completed a $50,000 feasibility study to analyze the decision to buy theXC-750, resulting in the followingestimates: Marketing: Once theXC-750 is operational nextyear, the extra capacity is expected to generate$10.10 million per year in additionalsales, which will continue for theten-year life of the machine. Operations: The disruption caused by the installation will decrease sales by$4.91 million this year. As withBillingham's existingproducts, the cost of goods for the products produced by theXC-750 is expected to be 75% of their sale price. The increased production will also require increased inventory on hand of$1.08 million during the life of theproject, including year 0 and depleted in year 10. HumanResources: The expansion will require additional sales and administrative personnel at a cost of $1.91 million per year. Accounting: TheXC-750 will be depreciated via thestraight-line method over theten-year life of the machine. The firm expects receivables from the new sales to be 14% of revenues and payables to be 11% of the cost of goods sold.Billingham's marginal corporate tax rate is 35%. a. Determine the incremental earnings from the purchase of theXC-750. b. Determine the free cash flow from the purchase of theXC-750. c. If the appropriate cost of capital for the expansion is 9.7%, compute the NPV of the purchase. d. While the expected new sales will be $10.10 million per year from theexpansion, estimates range from $8.05 million to $12.15 million. What is the NPV in the worstcase? In the bestcase? e. What is thebreak-even level of new sales from theexpansion? If the firm believes that sales will notincrease, but costs would be reduced by purchasing the newmachine, what is thebreak-even level for the cost of goodssold? f. Billingham could instead purchase theXC-900, which offers even greater capacity. The cost of theXC-900 is $4.04 million. The extra capacity would not be useful in the first two years ofoperation, but would allow for additional sales in years3-10. What level of additional sales(above the $10.10 million expected for theXC-750) per year in those years would justify purchasing the largermachine?

a. Determine the incremental earnings from the purchase of theXC-750.Calculate the incremental earnings from the purchase of theXC-750 below:(Round to the nearestdollar.)

Incremental Earnings
Year		0
Sales Revenues	$
Cost of Goods Sold	$
S, G, and A Expenses	$
Depreciation	$
EBIT	$
Taxes at 35%	$
Unlevered Net Income	$

(Round to the nearestdollar.)

Incremental Earnings
Year		1-10
Sales Revenues	$
Cost of Goods Sold	$
S, G, and A Expenses	$
Depreciation	$
EBIT	$
Taxes at 35%	$
Unlevered Net Income	$

b. Determine the free cash flow from the purchase of theXC-750.Calculate the free cash flow from the purchase of theXC-750:(Round to the nearestdollar.)

Incremental Free Cash Flow
Year		0
Unlevered Net Income	$
Depreciation	$
Capital Expenditures	$
Change in Net Working Capital	$
Free cash flow	$

(Round to the nearestdollar.)

Incremental Free Cash Flow
Year		1
Unlevered Net Income	$
Depreciation	$
Capital Expenditures	$
Change in Net Working Capital	$
Free cash flow	$

(Round to the nearestdollar.)

Incremental Free Cash Flow
Year		2-9
Unlevered Net Income	$
Depreciation	$
Capital Expenditures	$
Change in Net Working Capital	$
Free cash flow	$

(Round to the nearestdollar.)

Incremental Free Cash Flow
Year		10
Unlevered Net Income	$
Depreciation	$
Capital Expenditures	$
Change in Net Working Capital	$
Free cash flow	$

(Round to the nearestdollar.)

Incremental Free Cash Flow
Year		11
Unlevered Net Income	$
Depreciation	$
Capital Expenditures	$
Change in Net Working Capital	$
Free cash flow	$

c. If the appropriate cost of capital for the expansion is 9.7 %9.7%, compute the NPV of the purchase.The NPV of the purchase is $nothing. (Round to the nearestdollar.)d. While the expected new sales will be $ 10.10$10.10 million per year from theexpansion, estimates range from $ 8.05$8.05 million to $ 12.15$12.15 million. What is the NPV in the worstcase? In the bestcase?The NPV of the purchase for sales of $ 8.05$8.05 million is $nothing. (Round to the nearestdollar.)The NPV of the purchase for sales of $ 12.15$12.15 million is $nothing. (Round to the nearestdollar.)e. What is thebreak-even level of new sales from theexpansion? Thebreak-even level of new sales from the expansion is $nothing. (Round to the nearestdollar.)What is thebreak-even level for the cost of goodssold?Thebreak-even level for the cost of goods sold is $nothing. (Round to the nearestdollar.)f. Billingham could instead purchase theXC-900, which offers even greater capacity. The cost of theXC-900 is $ 4.04$4.04 million. The extra capacity would not be useful in the first two years ofoperation, but would allow for additional sales in years3-10. What level of additional sales(above the $ 10.10$10.10 million expected for theXC-750) per year in those years would justify purchasing the largermachine?The additional sales are $nothing. (Round to the nearestdollar.)