PLEASE HELP WITH MY CALCULATIONS.

California Health Center, a for$-$profit hospital, is evaluating the purchase of new diagnostic

equipment. The equipment, which costs $$600,000,$ has an expected life of five years and an estimated

pretax salvage value of $$200,000$ at that time. The equipment is expected to be used $15$ times a day

for $250$ days a year for each year of the project's life. On average, each procedure is expected to

generate $$80$ in collections, which is net of bad debt losses and contractual allowances, in its first

year of use. Thus, net revenues for Year $1$ are estimated at $15250$$$80=$$$300,000.$

Labor and maintenance costs are expected to be $$100,000$ during the first year of operation, while

utilities will cost another $$10,000$ and cash overhead will increase by $$5,000$ in Year $1.$ The cost for

expendable supplies is expected to average $$5$ per procedure during the first year. All costs and

revenues, except depreciation, are expected to increase at a $5$ percent inflation rate after the first year.

The equipment falls into the MACRS five$-$year class for tax depreciation and hence is subject to the

following depreciation allowances:

The hospital's tax rate is $40$ percent and its corporate cost of capital is $10$ percent.

a$.$ Estimate the project's net cash flows over its five$-$year estimated life.

b$.$ What are the project's NPV and IRR? $($Assume that the project has average risk.$)$