Net Present Value Method-Annuity Osborne Excavation Company is planning an investment of $209,500 for a bulldozer. The bulldozer is expected to operate for 2,000 hours per year for six years. Customers will be charged $105 per hour for bulldozer work. The bulldozer operator costs $28 per hour in wages and benefits. The bulldozer is expected to require annual maintenance costing $20,000. The bulldozer uses fuel that is expected to cost $37 per hour of bulldozer operation. Present Value of an Annuity of $1 at Compound Interest Year 6% 10% 12% 15% 20% 0.943 0.870 0.833 0.909 1.736 0.893 1.690 1.833 1.626 1.528 2.673 2.487 2.402 2.283 2.106 3.465 3.037 2.855 2.589 3.170 3.791 4.212 3.605 3.353 2.991 4.917 4.355 4.111 3.785 3.326 3.605 5.582 4.868 4.564 4.160 6.210 5.335 4.968 4.487 3.837 6.802 5.759 5.328 4.772 4.031 7.360 6.145 5.650 5.019 4.192 a. Determine the equal annual net cash flows from operating the bulldozer. Enter all amounts as positive numbers. Annual cash inflows: Hours of operation Revenue per hour Revenue per year Annual cash outflows: Hours of operation Fuel cost per hour Labor cost per hour Total fuel and labor costs per hour Fuel and labor costs per year Maintenance costs per year Annual net cash flow b. Determine the net present value of the investment, assuming that the desired rate of return is 20%. Use the table of present value of an annuity of $1 above. If required, round to the nearest dollar and use the minus sign to indicate a negative net present value. Present value of annual net cash flows Less amount to be invested Net present value than the present value of the ca c. Osborne Excavation should not support the investment because the bulldozer cost is greater flows at the minimum desired rate of return of 20%