Please resolve Net Present Value:

I followed your steps and derived $87871.59 is incorrect.

DataPoint Engineering is considering the purchase of a new piece of equipment for $310,000. It has an eight-year midpoint of its asset depreciation range (ADR). It will require an additional initial investment of $130,000 in nondepreciable working capital. $52,000 of this investment will be recovered after the sixth year and will provide additional cash flow for that year. Income before depreciation and taxes for the next six are shown in the following table. Use Table 1211, Table 1212. Use Appendix B for an approximate answer but calculate your final answer using the formula and financial calculator methods. Year 1 2 3 4 5 6 Amount $206,000 174,000 144,000 129,000 102,000 92,000 The tax rate is 25 percent. The cost of capital must be computed based on the following: Debt Preferred stock Common equity (retained earnings) Kd ke Cost (aftertax) 8.30% 12.40 17.00 Weights 40% 10 50 a. Determine the annual depreciation schedule. (Do not round intermediate calculations. Round your depreciation base and annual depreciation answers to the nearest whole dollar. Round your percentage depreciation answers to 3 decimal places.) a. Determine the annual depreciation schedule. (Do not round intermediate calculations. Round your depreciation base and annual depreciation answers to the nearest whole dollar. Round your percentage depreciation answers to 3 decimal places.) Depreciation Year Base 1 $ 2 310,000 310,000 310,000 310,000 3 Percentage Annual Depreciation Depreciation 0.200 $ 62,000 0.320 99,200 0.192 59.520 0.115 35.650 0.115 35,650 0.058 17,980 $ 310,000 4 5 310,000 6 310,000 b. Determine the annual cash flow for each year. Be sure to include the recovered working capital in Year 6. (Do not round intermediate calculations and round your answers to 2 decimal places.) Year 1 $ 2 Cash Flow 170,000 155,300 122,880 105.663 3 4 5 85,413 125,495 6 c. Determine the weighted average cost of capital. (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.) Weighted average cost of capital 13.06% d-1. Determine the net present value. (Use the WACC from part c rounded to 2 decimal places as a percent as the cost of capital (e.g., 12.34%). Do not round any other intermediate calculations. Round your answer to 2 decimal places.) Net present value $ 87,871.59 d-2. Should DataPoint purchase the new equipment? Yes