Please use cell references to fill in the yellow boxes

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2,205,000 1 Laurman, Inc. is considering the following project: 2 Required investment in equipment 3 Project life 4 Salvage value 225,000 57 6 7 A 2,750,000 1,600,000 1,150,000 TA The project would provide net operating income each year as follows: Sales Variable expenses Contribution margin Fixed expenses: Salaries, rent and other fixed out-of pocket costs Depreciation Total fixed expenses Net operating income 520,000 350,000 13 870,000 280,000 16 Company discount rate 18% 18 1. Compute the annual net cash inflow from the project. 20 2. Complete the table to compute the net present value of the investment. 20 2. Complete the table to compute the net present value of the investment. Year(s) Now 1-7 24 Initial investment 25 Annual cost savings 26 Salvage value of the new machine 27 Total cash flows 28 Discount factor 29 Present value of the cash flows 30 Net present value 1.000 32 Use Excel's PV function to compute the present value of the future cash flows 33 Deduct the cost of the investment 34 Net present value 35 36 3. Use Excel's RATE function to compute the project's internal rate of return 38 4. Compute the project's payback period. years 40 5. Compute the project's simple rate of return