show formula and steps please

3 $ 4 90,000 10 25,000 8,000 $ $ BELGI'S CHOCOLATES, INC. Cost of new machine 5 Life expectancy of new machine, in years Parts replacement costs at the end of year 6 7. Salvage value of new machine at the end of year 10 8 9 Annual operating costs of new machine 10 Annual operating costs of current method 11 Increased production (boxes) per year 12 Contribution margin per box 13 Required return on investment $ $ 10,000 19,000 5,500 2.00 14% $ 15 16 17 The syntax of the PV function is: PV(rate, nper, pmt, [fv], [type]) 18 Rate = Interest rate, in this problem, 14 [14%] 20 Nper = Number of periods, in years 22 Pmt - This argument is used only for the total net 23 annual cash inflows, which is computed in Part 1. 24 Leave this argument blank for all other PV computations. 26 FV = Future value. In this problem, the future value 27 is the cost of the replacement of parts at the end 28 of year 6 and the salvage value of the machine at the end of year 10. 30 Type = leave this field blank Doing so indicates 0 11 Problem Information: Belgi's Chocolates, Inc. is considering buying a new machine that will 12 automatically dip chocolates. (The dipping operation is currently done primarily by hand.) The annual costs 13 of the current method, relevant costs if the new machine is purchased, and other important information are 14 provided on the Given Data worksheet. BELGI'S CHOCOLATES, INC. Net Annual Cash Inflows Provided by the New Dipping Machine 16 18 20 21 19 Reduction in annual operating costs: Annual operating costs using current hand method Less: Annual operating costs of new machine = Annual savings in operating costs Plus: Increased annual contribution margin due to 23 increased production with the new machine 24 Total net annual cash inflows 25 26 27 Net Present Value of the New Machine Amount of Year(s) Cash Flows PV of Cash Flows 30 Item 31 Cost of the new machine 32 Parts replacement costs end of 6th year 33 Net annual cash inflows 34 Salvage value of new machine 35. Net present value 27 Net Present Value of the New Machine Amount of Cash Flows 80 Year(s) PV of Cash Flows Item 81 Cost of the new machine 32 Parts replacement costs end of 6th year 33 Net annual cash inflows 34 Salvage value of new machine 35 Net present value 36 Using the general decision rule for the net present value method, should the management of the company accept this project? Indicate your answer by typing Yes or No in the cell to 37 the right 39 RO 91 32