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please explain how to get answers for each box in detial and show work. thank you. a Final Exam Practice Problem Company A is considering

please explain how to get answers for each box in detial and show work. thank you.
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a Final Exam Practice Problem Company A is considering a contract to manufacture a new product. The company has spent $10,000 in research to decide whether or not to take this contract. The contract calls for the company to deliver 3,000 units in the first year. 4,000 units in the second year, 2,000 units in the third year, and 1,000 units in the last year. The price is $45 per unit for the first year and expected to increase with inflation. The variable costs of the product will be $20 per unit for the first year and also expected to increase with inflation. Inflation is 3% per year. The fixed costs will be $3,000 for the first year and $2,000 for year 2 to year 4. Selling, general, and administrative expenses are expected to be 20% of sales. Producing this product will require new equipment. The equipment cost $100,000. The shipping and installation costs of the machine ($10,000) will be capitalized and depreciated. The new equipment will be depreciated to $30,000 on a straight-line basis over 4 years. Training costs (Year 0 only) will be $5,000 (cannot be capitalized). At the end of 4 years, this equipment can be sold for $20,000. The net working capital is 10% of next year sales. The tax rate is 30%. Calculate the cash flow and NPV for this project (discount rate is 1296). Should the company accept the project? Year 0 Year 1 Year 2 Year 3 Year 4 Revenues Variable Costs Fixed Costs Expenses Depreciation EBIT Taxes NOPAT Depreciation Cap Ex ANWC -Net CFS Depr Base 30.000 Inflation Discount Rate Tax Rate S% 12% 306 Price per unit (Year 1) Variable costs per unit (Year 1) Expense of Sales) 45 20 20% NWC (% of next sales) 10. Training cost (Year) 5.000 Equipment cost(Year 0) Shipping and installation cost (Year) Equipment ending BV (Year 4) Equipment selling price (Year 4) 100.000 10.000 30,000 20.000 Year o Year! Year 2 Year 3 99.225 Revenues Variable Costs 189,000 -84,000 Year 4 52.093 -23,153 Fixed Costs -5,000 135.000 -60,000 -3,000 -27,000 -20,000 25,000 -7.500 -2.000 -19,845 -20.000 -10,419 20.000 -37,800 -20,000 45.200 -13.560 -5,000 1.500 Expenses Depreciation EBIT Taxes NOPAT Depreciation Cap Ex ANWC -3.500 17.500 20.000 31.640 20,000 9296 20.000 Selling price i selling price - ending BV"Tax Rate -110,000 -13.500 -127,000 20.000 23.000 5.209 45.775 R. 977 4.713 -5.400 32.100 60,618 34.009 Sales Units 3,000 3,000 45 2.000 2.000 Fixed Costs Unit Price VC per unit 4,000 2.000 47.25 21 1.000 2.000 52.09 23.15 4951 20 NWC 13.500 18.900 9.923 5.209 NPV 3.282.34 Positive NPV (Accept)

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