no excel please.

1 9 13.600 9.6400 You are a manager at Northern Fiber, which is considering expanding its operations in synthetic fiber manufacturing. Your boss comes into your office, drops a consultant's report on your desk, and complains, "We owe these consultants $1.4 million for this report, and I am not sure their analysis makes sense. Before we spend the $22 milion on new equipment needed for this project, look it over and give me your opinion." You open the report and find the following estimates (in millions of dollars): (Click on the con located on the top-right comer of the data table below in order to copy its contents into a spreadsheet.) Project Year Earnings Forecast (9000,000s) 2 10 Sales revenue 34.000 34.000 34.000 34.000 - Cost of goods sold 20.400 20.400 20.400 20.400 -Gross profit 13.600 13.600 13.600 -Selling, general, and administrative expenses 1.760 1.760 1.760 1.760 -Depreciation 2.200 2200 2 200 2.200 -Net operating income 9.6400 9.6400 9.6400 -Income tax 3.374 3.374 3.374 3.374 = Net income 6.266 6.266 6.266 6.266 All of the estimates in the report seem correct. You note that the consultants used straight-line depreciation for the new equipment that will be purchased today (year O), which is what the accounting department recommended for financial reporting purposes. Canada Revenue Agency allows a CCA rate of 30% on the equipment for tax purposes. The report concludes that because the project will increase earnings by $6.266 million per year for ten years, the project is worth $62.66 million. You think back to your halcyon days in finance class and realize there is more work to be done! First, you note that the consultants have not factored in the fact that the project will require $8 million in working capital upfront (year o). which will be fully recovered in year 10. Next, you see they have attributed $1.76 million of selling general and administrative expenses to the project, but you know that $0.88 million of this amount is overhead that will be incurred even if the project is not accepted. Finally, you know that accounting earnings are not the right thing to focus on! a. Given the available information, what are the free cash flows in years through 10 that should be used to evaluate the proposed project? bilf the cost of capital for this project is 12%, what is your estimate of the value of the new project? Please show work. Thanks