Labs Hypermarket has a pickup truck that it uses to deliver the online orders to their customers. The track must be either overhauled replaced company has assembled the following information Purchase cost (new) Remaining book value Overhaul needed now Annual cash operating costs Salvage value (now) Salvage value (seven years from now) ald Truck $37,000 New Truck $47,000 $27,000 526,000 $19.500 $18,000 $10,000 $13,000 $13,000 Brick The If the company keeps and overhauls its old delivery truck currently in use, then the truck will be usable for seven inore years. If a new trick is purchased, it will be mod for seven years, after which it will be traded in with another truck. The new truck would be diesel-operated, resulting in a substantial reduction in anal operating cots, w shown above. The company computes depreciation on a straight-line basis. All investment projects are evaluated using a 12% discount rate, Use the following tables to determine the appropriate discount factor(s). Required: 1. What is the net present value of the "keep the old truck" alternative? 2. What is the net present value of the "purchase the new truck" alterative? 3. Should Lulu Hypermarket keep the old truck or purchase the new one? Why? Lads Hypermarket has a pickup truck that it woes to deliver the online onders to their customers. The trick most be ether overhauled or replaced with a new truck. The company has assembled the following information Purchase cost (new) Remaining book value Overhaul needed now Annual cash operating costs Salvage value (now) Salvage value (seven years from now) und Truck $37,000 New Track $47.000 $27,000 $26,000 $19,500 $18,000 $10,000 $13,000 $13,000 If the company keeps and overhauls its old delivery truck currently in use, then the truck will be usable for seven more years. If a new trick is purchased, it will be med for seven years, after which it will be traded in with another truck. The new truck would be diesel-operated, resulting in a substantial reduction in annual operating costs, s shown above. The company computes depreciation on a straight-line basis. All investment projects are evaluated using a 12% discount rate. Use the following tables to determine the appropriate discount factor(s). Required: 1. What is the net present value of the "keep the old truck" alternative? 2. What is the net present value of the "purchase the new truck" alterative? 3. Should Lulu Hypermarket keep the old truck or purchase the new one? Why