Secure Homes is pondering an opportunity to produce and sell a new smart home monitoring system that can be managed remotely using a smartphone app. The company has gathered the following data on probable costs and market potential: a. New equipment would have to be acquired to produce the monitoring system. The equipment would cost $312,000 and be usable for 8 years. After 8 years, it would have a salvage value equal to 10% of the original cost. b. Production and sales of the monitoring system would require a working capital investment of $127,000 to finance accounts receivable, inventories, and day-to-day cash needs. This working capital would be released for use elsewhere by the company after 8 years. C. An extensive marketing study projects sales in units over the next 8 years as follows: Year (s) Sales in Units 4,370 7, 120 WA 10 , 400 -8 12 , 080 d. The monitoring systems would sell for $130 each; variable costs for production, administration, and sales would be $72 per unit. e. To gain entry into the market, the company would have to advertise heavily in the early years of sales. The advertising program follows: Amount of Year (s) Advertising $213 , 000 162,000 1-8 143,000 f. Other fixed costs for salaries, insurance, maintenance, and straight-line depreciation on equipment would total $377,000 per year. (Depreciation is based on cost less salvage value.) g. The company's required rate of return is 13%. (Ignore income taxes.) Required: 1. Compute the net cash inflow (cash receipts less yearly cash operating expenses) anticipated from sale of the monitoring systems for each year over the next 8 years. (Enter any cash outflows with a minus sign. Round your intermediate and final answers to the nearest dollar amount.) The net cash inflow from sales of the device for each year would be: Year 1 Year 2 Year 3 Year 4-8 Sales in units 4,370 7,120 10,400 12,080 Contribution margin Less fixed expenses: Advertising Other fixed expenses Total fixed expense 0 0 Net cash inflow (outflow)2-a. Using the data computed in requirement (1) above and other data provided in the problem, determine the net present value of the proposed investment. (Hint: Use Microsoft Excel to calculate the discount factor(s).) (Negative amount should be indicated by a minus sign. Do not round intermediate calculations and PV factor. Round the final answers to the nearest whole dollar amount.) Net present value 2-b. Would you recommend that Secure Homes invest in the new product? O Yes O No 3. What is the project's internal rate of return? (Hint. Use Microsoft Excel to calculate the discount factor(s).) (Round your answer to 1 decimal place.) Internal rate of return %