Pathfinder is considering replacing its old coring equipment. A newer model is now available that will save $15,092 in raw materials, $6,733 in utilities and $5,023 in labor per month. The best price they have been able to get for the new machine is $1,982,515. The cost of the existing machine was $1,180,000 and its accumulated depreciation is equal to $1,010,000. They can trade it in on the new machine for $21,340 or keep using it for another 12 years. The new machine will have to be overhauled at the end of its fifth year of use. The overhaul is expected to cost $69,252. The new machine has an estimated useful life of 12 years. Depreciation on both machines would be calculated based on the straight-line method. The salvage on the new machine is estimated to be $25,881 at the end of its life. The cost of capital is 11.677388573 % per year.

Determine whether the new machine should be purchased using the net present value method and also calculate its internal rate of return. Use present value interest factors rounded to the ninth decimal point and round your findings to the nearest whole Dollar. Ignore any tax effects. Complete the spreadsheet so that it correctly calculates the Net Present Value of this investment based on the cost of capital given and save it. Then make a copy of the file, rename it IRR.XLSM and revise the Annual Cost of Capital Rate to determine the investments Internal Rate of Return and save that file. When you have completed both versions of the spreadsheet submit them using the links in Blackboard. Save copies for yourself. Points will be deducted if you do not follow these instructions.