Problem #1 (15 points): MC Inc. is considering a proposal to invest $210,000 in new production equipment which will be depreciated on a straight-line basis (7-year life, no salvage value). Depreciation expense is included in Manufacturing costs. The projected annual revenues and costs of the new product that will be produced from the equipment are: Sales $236.000 Less costs and expenses: Manufacturing costs $145,000 Selling and administrative 55,000 200,000 Income before income taxes 36.000 Income tax expense 18,000 Net income $18,000 Present Value Factor for an Ordinary Annuity I n terest Rate or Discount Rate Periods 1% 2% 3% 4% 5% 6% 7% 8% 9% 10% 11% 12% 0.9901 0.9804 0.9709 0.9615 09624 0.94340.9346 0.9259 0.9174 0.90910,90090.8929 2 1.9704 1.9416 1.91361.88611.8694183341.8080 1.7833 1.7591 1.7355 1.7125 1.6901 3 2.9410 2.8839 2.8286 2.7751 2.723226730 2.6243 2.5771 2.5313 2.4869 2.443724018 4 3.9020 3.8077 3.7171 3.6299 3.5460 3.4651 3:3872 3.3121 3.2397 3.1699 3.1024 3.0373 5 4.85344.7136 4.5797445184.3296421244.1002 3.9927 | 3.8897 | 3.790836959 36048 6 5.7955 5.6014 5.41725.2421 5.075749173 4.7665 4.6229 4.48594.3553 4.2305 4.1114 7 67282 6.4720 6.23036.00215.786455824 5.3893 5 2064 6.03304.8684 4.71224.5638 8 7.661773255 7 01976.732764632 62098 5.9713 57466 55348 5 33495 1461 4.9676 9 8.5660 8.1622 77861 74353 7 1078 6.80176.5152 6.2469 6 9952 57590 5.5370 5.3282 10 9.4713 89826 8.53028. 1109 7.7217 7.3601 7.0236 6.7101 6.41776. 1446 58892 5.6502 Instructions: (a) Compute the annual Instructions: (a) Compute the annual rate of return (b) Compute the cash payback period. Problem #1 (con't): (s) Compute the net present value assuming a 10% required rate of return di Determine the estimated intemal rate of retum