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Saved Help Save & Exit 4 Check my Laurel's Lawn Care Lid., has a new mower line that can generate revenues of $177,000 per year. Direct production costs are $59,000, and the fixed costs of maintaining the lawn mower factory are $24,500 a year. The factory originally cost $1.18 million and is being depreciated for tax purposes over 20 years using straight-line depreciation. Calculate the operating cash flows of the project if the Ints firm's tax bracket is 25%. (Enter your answer in dollars not in millions.) Skipped Operating cash flows e Book Print Next > Prev 5 of 15 Mc Graw W HILL O Type here to searchSaved Help Save & Exit Check my PC Shopping Network may upgrade its modem pool. It last upgraded 2 years ago, when it spent $110 million on equipment with an assumed life of 5 years and an assumed salvage value of $20 million for tax purposes. The firm uses straight-line depreciation. The old equipment can be sold today for $80 million. A new modem pool can be installed today for $150 million. This will have a 3-year life and nts will be depreciated to zero using straight-line depreciation. The new equipment will enable the firm to increase sales by $24 million per year and decrease operating costs by $12 million per year. At the end of 3 years, the new equipment will be worthless. Assume the Skipped firm's tax rate is 30% and the discount rate for projects of this sort is 8%. Required: a. What is the net cash flow at time 0 if the old equipment is replaced? (Negative amounts should be indicated by a minus sign. Do eBook not round intermediate calculations. Enter your answer in millions rounded to 2 decimal places.) b. What are the incremental cash flows in years (i) 1; (ii) 2; (iii) 3? (Do not round intermediate calculations. Enter your answer in Print millions rounded to 2 decimal places.) c. What is the NPV of the replacement project? (Do not round intermediate calculations. Enter the NPV in millions rounded to 2 decimal places.) d. What is the IRR of the replacement project? (Do not round intermediate calculations. Enter the IRR as a percent rounded to 2 decimal places.) Net cash flow million a. Incremental cash flow million per year b. million C. NPV % d. IRR Next >