Read this case study and then answer the questions that follow.

$1.$ Amelia Smith lives in Chatswood, NSW and has decided to expand her home bakery business by building a new factory in Chatswood, NSW$.$ Last month, she flew to Melbourne to visit a former employee who is now a business consultant to get some ideas. She flew there and back on the same day, and the total cost, including Uber and airfares, was $$1,500.$ The consultant she visited charged $$5,000$ for his report and advised her to use her existing investment property to build the new bakery. The investment property is currently leased to Breadworks for $$4,000$ a month. The cost of fitting out the new premises will be $$400,000,$ and equipment will be $$270,000.$ The accountant insists that depreciation should be charged on a straight$-$line basis over $20$ years. However, ATO rules specify that fit$-$outs must be depreciated over $20$ years and equipment over $25$ years on a straight$-$line basis. The new premises will also require a $$125,000$ investment in working capital.

$2.$ Previously, Amelia rented a factory in Lane Cove at a cost of $$1,500$ per month. She expects that revenues from the new factory will increase from $$8,000$ to $$22,000$ per month. Costs will decrease from $$11,000$ to $$8,000$ per month.

$3.$ All staff will be retained on their current conditions, except that John Turner will no longer be needed. He will be made redundant, saving $$150,000$ per year. In view of his years of faithful service, Amelia will pay him a $$695,000$ redundancy in year $0$ if the project goes ahead. This payment is tax$-$deductible.

$4.$ Amelia will require a $$500,000$ Interest$-$Only loan from Commonwealth Bank at $10\%$ per annum $($$$50,000$ interest per year$).$

$5.$ The project is expected to last $10$ years.

$6.$ All cash flows are given in real terms. The nominal interest rate for projects like this is $10\%,$ and expected inflation is $5\mathrm{.}5\%.$

$7.$ The only equipment owned by Amelia at the old premises was purchased $8$ years ago for $$280,000$ and has a useful life of $10$ years according to the ATO. It is currently being depreciated for tax purposes over $10$ years on a straight$-$line basis. If the project goes ahead, she expects to be able to sell the equipment for $$95,000.$

$8.$ At the end of the project, the fit$-$out will be worthless, and the equipment will be worth $$200,000.$

$9.$ The tax rate is $30\%.$

Calculate the Free Cash Flows for Period $0.$ Show all Workings