N&N Inc., a local food processing company, is considering an opportunity to upgrade its current packaging machine for the next five years.

The existing machine was purchased five years ago for $60,000 and can be sold now for $30,000. Its resale value in five years will be $5,000. The purchase price for the new machine will be $110,000. In addition, the vendor of the new machine will charge $10,000 for shipping and installation. The resale value of the new machine in five years will be $20,000. Additional inventories of $5,000 will be required when the new machine is in use, but the inventories can be restored to the current level at the end of five years. Both machines belong to a class with a CCA rate of 30 percent. N&N's tax rate is 35% and the cost of capital is estimated to be 20%. N&N estimates that the new machine will reduce operating expenses by $35,000 per year for five years. The new machine will be financed by a bank loan and interest payments for the loan are estimated to be 2,000 every year.

a) The discounted cashflows for period 0 (including all initial cashflows and changes in working capital) are? ............

Answer rounding to the nearest integer (ZERO decimals), do not include any symbols, like dollar signs ($) percentage signs (%) or thousand separators (,). If solution is a negative number include a - sing before the number whiteout any space. For example : -1152

b) The discounted cashflows for period 5 (including all terminal cashflows and operative cashflows) are?

Answer rounding to the nearest integer (ZERO decimals), do not include any symbols, like dollar signs ($) percentage signs (%) or thousand separators (,). If solution is a negative number include a - sing before the number whiteout any space. For example : -1152

c) The NPV of the replacement project is ?

Answer rounding to the nearest integer (ZERO decimals), do not include any symbols, like dollar signs ($) percentage signs (%) or thousand separators (,). If solution is a negative number include a - sing before the number whiteout any space. For example : -1152

d) Should the company replace the equipment (yes or no)?