Required: 1. Complete the following table assuming use of straight-line depreciation. Net cash flow equals the amount of income before depreciation minus the income taxes. Income Before Depreciation Straight-Line Depreciation Taxable Income Income Taxes Net Cash Flows Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 2. Complete the following table assuming use of MACRS depreciation. Net cash flow equals the amount of income before depreciation minus the income taxes. Income Before Depreciation MACRS Depreciation Taxable Income income Taxes Net Cash Flows Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 3. Compute the net present value of the investment if straight-line depreciation is used. Use 8% as the discount rate. Chart Values are based on: Year Net Cash Inflow PV Factor Present Value 1 Net present value 4. Compute the net present value of the investment if MACRS depreciation is used. Use 8% as the discount rate. Chart Values are Based on: Year Net Cash Inflow * Factor Present Value Net present value (The following information applies to the questions displayed below.) Manning Corporation is considering a new project requiring a $90,000 investment in test equipment with no salvage value. The project would produce $67,500 of pretax income before depreciation at the end of each of the next six years. The company's income tax rate is 30%. In compiling its tax return and computing its income tax payments, the company can choose between the two alternative depreciation schedules shown in the table. (FV of $1, PV of $1, FVA of $1 and PVA of $1) Use MACRS) (Use appropriate factor(s) from the tables provided.) Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Straight-Line Depreciation $ 9,000 18,000 18,000 18,000 18,000 9,000 MACRS Depreciation $ 18,000 28,800 17,280 10,368 10,368 5,184 Totals $90,000 $90,000