Mr Jim Allen is starting a business. He would need to purchase a delivery van fleet that costs $175,000 to equip the business and another $45,000 for inventories and other working capital needs. Rent for the building used by the business will be $18,000 per year. Jim's marketing studies indicate that the annual net cash inflow from the business will amount to $65,000. Jim wants to operate the catering business for only seven years. He estimates that the equipment could be sold at that time for 12,000. The working capital will be fully released for other purposes at the end of the seven years. Jim uses a 10% discount rate. Required: 1) Calculate Jim's NPV of the project (Hint: postive numbers are cash inflows and negative numbers are cash outflows) Description Years Amount 10% Factor Present Value Van fleet V V V Working capital Building rent V Net annual cash inflow Salvage value, equipment V V Release of Working Capital V V Net Present Value 2) Should Jim accept or reject the project