Maria Corporation Limited (MCL) is interested to invest in a project. The initial cost of the project is Rs. 11.5 million with the salvage value of Rs. 2 million. The project will generate generates revenue of Rs 15 million per year with variable cost of Rs. 6 million and other expenses of Rs. 4 million. The revenue and cost/expense will expected to increase by 5% per annum for first 3 years and 7.5% for last 2 years. MCLs cost of capital is 12%. The depreciation of the project is to be calculated at 33.33%, 44.45%, 14.81% and 7.41% respectively. The working capital changes as to percentage of revenue is 25%. The tax rate for the MCL is 35% per annum.

Required:

a) Calculate the operating cash-flows of the project till year 5.

b) Evaluate the project via all capital budgeting techniques.