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rou must evaluate the purchase of a proposed spectrometer for the R80 department. The purchase price of the spectrometer including modifications is $240,000, and the

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rou must evaluate the purchase of a proposed spectrometer for the R80 department. The purchase price of the spectrometer including modifications is $240,000, and the equipment vill be fully depreciated at the time of purchase. The equipment would be sold after 3 years for $27,000. The equipment would require a $13,000 increase in net operating working capital (spare parts inventory). The project would have no effect on revenues, but it should save the firm $69,000 per year in before-tax labor costs. The firm's marginal federallus-state tax rate is 25%. a. What is the initial investment outlay for the spectrometer after bonus depreciation is considered, that is, what is the Year 0 project cash flow? Enter your answer as a positive value. Round your answer to the nearest dollar. b. What are the project's annual cash flows in Years 1, 2, and 3 ? Do not round intermediate calculations. Round your answers to the nearest dollar. Year 1: 5 Year 2:5 Year 3: $ c. If the WACC is 10%, should the spectrometer be purchased

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