Please help with the following:

a. given the available information, what are the free cash flows in year 0 through 10 that should be used to evaluate the proposed project?

b. if the cost of capital for this project is 12% what is your estimate of the value of the new project?

You are a manager at Percolated Fiber, which is considering expanding its operations in synthefic fiber manufacturing Your boss comes into your office, drops a consultant's report on your desk, and complains, "We owe these consultants $1.2 million for this report, and 1 am not sure their analysis makes sense. Before we spend the $15 million 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 milions of dollars). (Click on the following icon in order to copy its contents into a spreadsheet) All of the estumates in the report seem correct You note that the consultants used straight line depreciation for the new equipment that will be purchased today (year 0 ), which is what the accounting department recommonded The report concludes that because the project will increase earnings by $6.375 malion por year for 10 years, the project is worth $63.75 milion. You think back to your halcyon days in finance class and realize there is more work to be donel First, you note that the consultants have not factored in the fact that the project will require $10 malion in working capital upfront (year 0 ), which will be fulty recoverod in year 10 Noxt, you see they have attributed $1.2 mition of seling, general and admanistrative expenses to the projoct. but you know that $0.6 miltion 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 night thing to focus onl a. Given the available information, what are the free cash flows in years 0 through 10 that should be used to evaluate the proposed project? b. If the cost of captal for this project is 12%, what is your estimate of the value of the new project