Oregon Forest Products will acquire new equipment that falls under the five-year MACRS category. The cost is $520,000. If the equipment is purchased, the following earnings before depreciation and taxes will be generated for the next six years. Use Table 12-12. Use Appendix B for an approximate answer but calculate your final answer using the formula and financial calculator methods. Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Earnings before Depreciation $151,000 215,000 140,000 120,000 90,000 46,000 The firm is in a 25 percent tax bracket and has a 12 percent cost of capital. a. Calculate the net present value. (A negative amount should be indicated by a minus sign. Do not round intermediate calculations and round your answer to the nearest whole dollar amount.) nces Net present value $ (293,158.00) b. Under the net present value method, should Oregon Forest Products purchase the equipment asset? O Yes O No Table 12-12 Depreciation percentages (expressed in decimals) Depreciation Year 5-Year MACRS 7-Year MACRS 10-Year MACRS 15-Year MACRS 20-Year MACRS 1 2. 3-Year MACRS 0.333 0.445 0.148 0.074 3 ......... 0.200 0.320 0.192 0.115 0.115 0.058 4 0.143 0.245 0.175 0.125 0.089 0.089 0.089 0.045 6 7 8 9 10 11 0.100 0.180 0.144 0.115 0.092 0.074 0.066 0.066 0.065 0.065 0.033 0.050 0.095 0.086 0.077 0.069 0.062 0.059 0.059 0.059 0.059 0.059 0.059 0.059 0.059 0.059 0.030 0.038 0.072 0.067 0.062 0.057 0.053 0.045 0.045 0.045 0.045 0.045 0.045 0.045 0.045 0.045 0.045 0.045 0.045 0.045 0.045 0.017 1.000 12 ... 13 14 15 16 17 18 19 20 21 1.000 1.000 1.000 1.000 1.000