Net Present Value and Competing Alternatives Follow the format shown in Exhibit 126-1 and Exhibit 128-2 as you complete the requirements below. Stilwater Designs has been rebuilding Model 100, Model 120, and Model 150 Kicker subwoofers that were returned for warranty action. Customers returning the subwoofers receive a new replacement. The warranty returns are then rebuilt and resold (as seconds). Tent sales are often used to sell the rebuilt speakers. As part of the r i ng process the speakers are demagnetized so that metal pieces and shavings can be removed. A demagnetizing (demag) machine is used to achieve this objective. A product design change has made the most recent Model 150 speakers too tall for the demag machine. They no longer fit in the demag machine Stillwater Designs is currently considering two alternatives. First, a new demag machine can be bought that has a different design, eliminating the fit problem. The cost of this machine is $600,000, and it will last 5 years. Second, Stillwater can keep the current machine and sell the 150 speakers for scrap, using the old demag machine for the Model 100 and 120 speakers only. A rebuilt speaker sells for $295 and costs $274.65 to rebuild (for materials, labor, and overhead cash outlays). The $274.65 outlay includes the annual operating cash effects of the new demag machine. If notrebuit, the Model 150 speakers can be sold for $4 each as scrap. There are 10,000 Model 150 warranty returns per year. Assume that the required rate of retum is 10% EUW Exhibit 128.2 Present Value of an Annuity 30 25% 20% 16% 18% 12% 14% 10% 9% 8% 7% 6% 5% 4% M IS 1000010 0010 607087 0.06154 0.95238 0.94340 0.91458 0.9259) 0.91743 0.909090.89286 0.87719 0.86207 0.84746 0.83333 0.80000 0.76 1.60523 1.56564 1.52778 1.44000 1.361 2 197040 1.4156 1.91307 1.88600 1.85041 1.83339 1.80802 1.78326 1.75911 1.73554 1.69005 1.64666 1 204000 2288 22861 277509 2.72325 2.67301 2.62432 2.57710 2.53129 2.48685 2.40183 272162.24589 2.17427 2.10648 1.95200 1.816 16 . 1 1910 1 1 12 10 12990 1989 1,46511 3 3821 131213 3239723,1698 303 298 18 26906 2S887 236160 3 414 014 5971 45182 4.32948 4.21236 4.10020 3.99271 3.88965 3.79079 3.60478 33308 3.274293.12717 2.99061 2.68928 2.4355 650548 560143 5.41719 5.24214 5.07569 491712 4.76654 4.62288 4.48592 4.35526 4.11141 3.88867 3.68474 3.49760 3.32551 2.95142 2.64275 7 219 60199 623028 6.00205 5.78617 5.58238 5.38929 5.20637 5.03295 4.86842 4.56376 4.28830 4.03857 3.81153 3.60459 3.16114 2.80211 # 765168 732548 701960 6.73274 6.46321 6.20979 5.97130 574664 5.53482 5.33493 4.96764 4.63886 4.34359 4.07757 3.83716 3.32891 2.92470 9 2 1024 7.611 74353) 7.10782 6.80169 6.51523 6.24689 5.99525 5.75902 5.32825 4.94637 4.60654 4.30302 4.03097 3.46313 3.01900 109.47130 2.98250 8.53020 8.11090 7.72173 7.36009 7.02358 6.71008 6.417666.14457 5.65022 5.21612 4.83323 4.49409 4.19247 3.57050 11 10.100 3.09154 6 5 025262 3.76048 8.306417.88687 7.49367 7.13896 6.80519 6.49506 5.93770 5.45273 5.02864 4.65601 4.32706 3.65640 12 11.250 1675495400 9.38507 8.86325 8.38384 7.94260 7.53608 7.160736.81369 6.19437 5.66029 5.19711 4.79322 4.43922 3.72512 3.19026 3.14734 11 121127411.4V 10.63496 9.98565 9.30157 8.85268 8.35765 7.90378 748690 7.10336 6.42355 5.84236 5.34233 4.90951 4.53268 3.78010 14 11.00170 12.10625 11.29607 10.563129.0364 9.20408 8.74547 8.24424 7.786157.36660 6.62817 6.00207 5.46753 5.00806 4.61057 3.82408 3.24867 3.22328 15 11.50 12.4926 11.91794 11.11839 10.37966 9.71225 9.10791 8.55948 8.06069 7.60608 6.81086 6.14217 5.57546 5.09158 4.67547 3.85926 16 17 11.777 12.56110 11.65210 10.81777 10.10500 944665 8.85137 8.312567.82371 6,97399 6.26506 5.668 SO 17 15.5022 1429187 11.16612 12.16567 11.27407 10.47726 9.76322 9.12164 8.54363 8.02155 7.11963 6.37286 5.74870 3.26821 5.16235 4.72956 3.88741 3.28324 16 16.302714.99201 11.75351 12.65030 11.68959 10.82760 10.05909 9.37189 8.75563 8.20141 7.24967 6.46742 5.81785 5.27316 19 17.2260115.675461432380 13.13394 12.08512 11.15812 10.33560 9.60360 8.95011 8.36492 7.36578 6.55037 5.87746 5.31624 4.84350 3.94235 3.31053 5.22233 4.77463 3.90993 3.29480 20 LASSS1635101487147 1.50013 12.46221 11 46992 10.59401 9.81815 9.12855 8.51356 7.46944 6.62313 5.92884 5.35275 4.86958 3.95388 3.31579 4.81219 3.92794 3.30369 21 18.85698 17.0112115.41502 14.02916 12.82115 11.76408 10.83553 10.01680 9.29224 8.64869 7.56200 6.68696 5.97314 5.38368 4.89132 3.96311 3.31984 22 19.4018 17 ASROS 15.04.02 14A5112 11.16300 12.04158 11.06124 10.20074 944243 8.77154 7.64465 6.742946.01133 5.40990 4.90943 3.97049 3.32296 23 20.45582 16.29220 16.44361 14.85684 13.48857 12.30338 11.27219 10.37106 9.58021 8.88322 7.71843 6.79206 6.04425 5.43212 4.92453 3.97639 24 2124110 1691193 16.93554 15 24696 13.79864 12.55036 11.46933 10.52876 9.70661 8.98474 7.78432 6.83514 6.07263 5.45095 4.93710 3.98111 3.32719 25 22.02.16 19.52346 1741315 15.62208 14.09394 12.78336 11.65358 10.67478 9.82258 9.07704 7.84314 6.87293 6.09709 5.46691 4.94759 3.98489 3.32861 3.32535 26 22.79520 20.121041787684 15.98277 14.37519 13.00317 11.82578 10.80998 9.92897 9.16095 7.89566 6.90608 6.11818 5.48043 4.95632 3.98791 3.32970 27 23:55961 20.70690 18.32703 16.32959 14.643031321053 11.98671 10.93516 10.02658 9.23722 7.94255 6.93515 6.13636 5.49189 4.96360 3.99033 3.33054 23 201614212612718.761116.66306 14.89813 13.40616 12.13711 11.05108 10.11613 9.30657 7.98442 6.96066 6.15204 5.50160 4.96967 3.99226 3.33118 >> 25.0657971.438 19.16845 16.98371 15.14107 11.50072 12.27767 11.15841 10.19828 9.36961 8.02181 6.98 104 6.16555 5.50983 4.97472 3.99381 3.33168 10 258077 22.3946 19.60044 17.29203 15.37245 13.76483 12.40904 11.25778 10.27365 942691 8.05518 7.00266 6.17720 5.51681 4.97894 3.99505 3.31206 mibit 128.1 Present Value of a Single Amount" 25 3 20% 0 18% 16% 14% 12% 9% 10% 7% 5% 6% 1% 3% 4% 8% 2% 1 0.99010 0.98039 0.97087 0.96154 0.95238 0.94340 0.93458 0.92593 0.91743 0.90909 0.89286 0.87719 0.86207 0.84746 0.83333 0 30000 0.769 OD 0.591 2 0.98030 0.96117 0.94260 0.92456 0.90703 0.89000 0.87344 0.85734 0.84168 0.82645 0.79719 0.76947 0.74316 0.71818 0.694 T O 0.45517 3 0.97059 0.94232 0.91514 0.88900 0.86384 0.83962 0.81630 0.79383 0.77218 0.75131 0.71178 0.67497 0.64066 0.60863 0.5/8/0 0.35013 A 006008 0.92385 0.88849 0.85480 0.82270 0.79209 0.76290 0.73503 0.70843 0.68301 0.63552 0.59208 0.55229 0.51579 0.48225 0.40960 5 095147 0.00573 0.86261 0.82193 0.78353 0.74726 0.71299 0.68058 0.64993 0.62092 0.56743 0.51937 0.47611 0.43711 0.40188 0.32768 0.26933 6 004205 0.88797 0.83748 0.79031 0.74622 0.70496 0.66634 0.63017 0.59627 0.56447 0.50663 0.45559 0.41044 0.37043 0.33490 0.26214 0.20718 7093272 0.87056 0.81309 0.75992 0.71068 0.66506 0.62275 0.58340 0.54703 0.51316 0.45235 0.39964 0.35383 0.31393 0.27908 0.20972 0.15937 8 0.92348 0.85349 0.78941 0.73069 0.67684 0.62741 0.58201 0.54027 0.50187 0.46651 0.40388 0.35056 0.30503 0.26604 0.23257 0.16777 0.12259 9 091434 083676 0.76642 0.70259 0.64461 0.59190 0.54393 0.50025 0.46043 0.42410 0.36061 0.30751 0.26295 0.22546 0.19381 0.13422 0.09430 10 0.90529 0.82035 0.74409 0.67556 0.61391 0.55839 0.50835 0.46319 0.42241 0.38554 0.32197 0.26974 0.22668 0.19106 0.16151 0.10737 0.07254 11 0.89612 0.80426 0.72242 0.64958 0.58468 0.52679 0.47509 0.42888 0.38753 0.35049 0.28748 0.23662 0.19542 0.16192 0.13459 0.08590 0.05580 12 0.88745 0.78849 0.70138 0.62460 0.55684 0.49697 0.44401 0.39711 0.35553 0.31863 0.25668 0.20756 0.16846 0.13722 0.11216 0.06872 0.04292 13 0.87866 0.77303 0.68095 0.60057 0.53032 0.46884 0.41496 0.36770 0.32618 0.28966 0.22917 0.18207 0.14523 0.11629 0.09346 0.05498 0.03302 14 0.86996 0.75788 0.66112 0.57748 0.50507 0.44230 0.38782 0.34046 0.29925 0.26333 0.20462 0.15971 0.12520 0.09855 0.07789 0.04398 0.02540 15 0.16135 0.74301 0.64186 0.55526 0.48102 0.41727 0.36245 0.31524 0.27454 0.23939 0.18270 0.14010 0.10793 0.08352 0.06491 0.03518 0.01954 16 0.85282 0.72845 0.62317 0.53391 0.45811 0.39365 0.33873 0.29189 0.25187 0.21763 0.16312 0.12289 0.09304 0.07078 0.05409 0.02815 0.01503 17 0.84438 0.71416 0.60502 0.51337 0.43630 0.37136 0.31657 0.27027 0.23107 0.19784 0.14564 0.10780 0.00021 0.05998 0.04507 0.02252 0.01156 18 0.83602 0.70016 0.58739 0.49363 0.41552 0.35034 0.29586 0.25025 0.21199 0.17986 0.13004 0.09456 0.06914 0.05083 0.03756 0.01801 0.00889 19 0.82774 0.68643 0.57029 0.47464 0.39573 0.33051 0.27651 0.23171 0.19449 0.16351 0.11611 0.08295 0.05139 0.04308 0.03130 0.01441 0.00684 20 0.81954 0.67297 0.55368 045639 0.37689 0.31180 0.25842 0.21455 0.17843 0.14864 0.10367 0.07276 0.05139 0.03651 0.02608 0.01153 0.00526 21 0.81143 0.65978 0.53755 0.43883 0.35894 0.29416 0.24151 0.19866 0.16370 0.13513 0.09256 0.06383 0.04430 0.03094 0.02174 0.00922 0.00405 22 0.80340 0.64684 0.52189 0.42196 0.34185 0.27751 0.22571 0.18394 0.15018 0.12285 0.08264 0.05599 0.03819 0.02622 0.01811 0.00738 0.00311 23 0.79544 0.63416 0.50669 0.40573 0.32557 0.26180 0.21095 0.17032 0.13778 0.11168 0.07379 0.04911 0.03292 0.02222 0.01509 0.00590 0.00239 24 0.78757 0.62172 0.49193 0.39012 0.31007 0.24698 0.19715 0.15770 0.12640 0.10153 0.06588 0.04308 0.02838 0.01883 0.01258 0.00472 0.00184 25 0.77977 0.60953 0.47761 0.37512 0.29530 0.23300 0.18425 0.14602 0.11597 0.09230 0.05882 0.03779 0.02447 0.01596 0.01048 0.00378 0.00142 26 0.77205 0.59758 0.46369 0.36069 0.28124 0.21981 0.17220 0.13520 0.10639 0.08391 0.05252 0.03315 0.02109 0.01352 0.00874 0.00302 0.00109 27 076440 0.58586 0.45019 0.34682 0.26785 0.20737 0.16093 0.12519 0.09761 0.07628 0.04689 0.02908 0.0181B 0.01146 0.00728 0.00242 0.00084 28 0.75684 0.57437 0.43708 033148 025509 0.19561 0.15040 0.11591 0.00055 0.06934 0.04187 0,02551 0.01567 0.00971 0.00607 0.00193 0.00065 29 0.74914 056311 0A2435 0.32065 024295 0.18456 0.14056 0.10733 0.08215 0.06304 0.03738 0.02237 0.01351 0.00823 0.00506 0.00155 0.00050 30 0.74192 0.55207 0.41199 0.30832 0.23138 0.17411 0.13137 0.09938 0.07537 0.05731 0.03338 0.01963 0.01165 0.00697 0.00421 0.00124 *P. ANY 0.00038 aired: Determine which alternative is the best for Stillwater Designs by using NPV analysis. If required, round to the nearest dollar. PV (rebuild alternative) PV (scrap alternative) Rebuild alternative 171,265 X 151,600 X 2. CONCEPTUAL CONNECTION: Determine which alternative is best for Stillwater Designs by using an IRR analysis. Enter as a percent. Round your answers to the nearest whole percent. IRR is infinite, leave the cell blank.. % IRR. (rebuild sternative) IRR (scrap alternative) Scrap alternative 31.72 31.72 X Why NPV analysis a better approach? It measures the absolute Improvement in dollars