RockHill inc. is trying to access the viability of a proposed project. The project requires an investment of $10.5 million in a certain type of machine, and an additional $1.5 million in modifying the machine in order to upgrade it. The machine is fully depreciated at the time of purchase, and salvage value of the machine is estimated to be $1.5 million. The project requires a $650,000 investment in net operating work capital, and the project has a lifespan of 5 years. The financial staff has collected the following information on the project: Sales revenues $11.5 million Operating costs $6.25 million Interest expense 1 million The company has a 25% tax rate, and its WACC is 15.25%. a) What is the project's free cash flow for the years 0, 1, 2, 3, 4 & 5? (6) Should RockHill accept this project? Explain using at least 2 project evaluation criteria that we learnt in the class