Net Present Value and Taxes [LO 2,4] Island Ferry plans to expand operations by acquiring another boat. It has a bid of $950,000 from a boat manufacturer to provide a boat that Can Carry 40 Passengers The boat has an expected life of seven years with an expected residual value for financial reporting and tax Purposes of $50,000. Island Ferry has a tax rate of 40 percent and Uses straight-line depreciation for tax purposes. Its required rate of return is 10 percent. The following annual cash flows relate to the investment in the new boat: Calculate the net present value of the investment in the boat. Should the company make the investment