Smart Vehicle Ltd is an Electric Bicycle manufacturer in Kelowna, BC$.$ It has a $20,000$ square feet factory and a $10,000$ square feet office building. The company also owns a production line. Smart Vehicle is very successful in the rapid growing E$-$bike market. It wants to expand the business by set up a new plant in Delta, BC in Sept $2024.$ The financial manager hired you, a UCW graduate, to complete a capital budget report. Do you recommend the company to accept the project or not? Below is the information that your manager provided: $1.$ Smart Vehicle will buy a piece of used farmland in Delta to build a new plant. The manager estimate that it will cost the company $$300,000.$ The approximate cost of the building would be $$120,000.$ The company will add new equipment to the plant, which will cost $$250,000,$ with another $$19,500$ in shipping charges. It would also cost an additional $$9,500$ tuning fees and $$10,000$ for the installation parts. $2.$ The financial manager will outsource the equipment installation. He will hire $5$ workers for $1$ months from a contractor. They will work $8$ hours per day, $5$ days a week. The hourly wage is $$25.$ However, the operation manager insisted on completing the installation by Smart Vehicle themselves because they have a team of $10$ full time workers in Kelowna who can relocate to Delta to help with the installation without extra wages. Smart Vehicle pays minimum wage for all works in $2024.$ Finally, The CEO approved the financial managers proposal. $3.$ Both the plant and the equipment have an economic life of $6$ years, but the manager didnt know the CCA classification and CCA rate. He estimated that the plant and equipment are expected to have a zero$-$salvage value for a quick estimation. But he proposed to sell the land after $5$ years. $4.$ The new product line would generate incremental sales of $5,500$ bikes per year for $6$ years and they are expected to grow $5\%$ per year. $5.$ The variable cost per unit is estimated in $$200$ per unit in the first year. Each unit can be sold for $$1,800$ in the first year. $6.$ The sales price and cost are both expected to increase due to inflation. The fixed costs are estimated to be $$110,000$ per year and would increase with inflation. The manager asks you to do the research about the inflation rates in past years and make a forecast for the future $6$ years. $7.$ The company hired $5$ workers to operate the new equipment and provided them $60$ hours paid training according to BC minimum wage. The training includes $30$ hours general safety training and $30$ hours specific training on how to operate the machine. They will work on the production line $35$ hours per week under a five$-$year contract with $15$ working days paid leave. $8.$ The manager estimated the initial inventory will be $$150,000$ in the first year and will increase $3\%$ every year. The accounting team estimate the AP and AR wont be affected in the project. $9.$ The company received $$50,000$ Research fund from BC government and decided to use $50\%$ of them to do market research on the new project. It has also spent $20\%$ of the funding to attend conferences and expos. The $20\%$ will be allocated to the purchase of the equipment. $10.$ The manager has concerns about the potential market saturation on the new plant and the Kelownas head office. But he hasnt data of how the new plant affect the sales. $11.$ The firm is a small business which taxable revenue under $$500,000.$ The project is considered by the financial department to be as risky as the company. The financial department has estimate that the total WACC is $12\%$ including $$50,000$ interest paid every year. Using an Excel spreadsheet: Find the NPV of the project by using the pro forma financial statement method to determine cash flows. Set up the necessary equations by referencing to the input variable cells. The spreadsheet must be formula driven; do not put any numbers in equations, must use cell references. Use Excels built$-$in functions wherever possible.