Solomon Electronics is considering Investing in manufacturing equipment expected to cost $$340,000.$ The equipment has an

estimated useful life of four years and a salvage value of $$21,000.$ It is expected to produce incremental cash revenues of $$170,000$

per year. Solomon has an effectlve income tax rate of $40$ percent and a desired rate of return of $12$ percent. $($PV of $$1$ and PVA of $$1$

Note: Use approprlate factor$($s$)$ from the tables provlded.

Required

a$.$ Determine the net present value and the present value Index of the Investment, assuming that Solomon uses straight$-$IIne

depreclation for financial and income tax reporting.

b$.$ Determine the net present value and the present value Index of the Investment, assuming that Solomon uses double$-$declining$-$

balance depreclation for financlal and Income tax reporting.

d$.$ Determine the payback perlod and unadjusted rate of return $($use average investment$),$ assuming that Solomon uses straight$-$line

depreclation.

e$.$ Determine the payback perlod and unadjusted rate of return $($use average Investment$),$ assuming that Solomon uses double$-$

declining$-$balance depreclation. $($Note: Use average annual cash flow when computing the payback perlod and average annual

Income when determining the unadjusted rate of return.$)$

Complete this question by entering your answers in the tabs below.

Determine the net present value and the present value index of the investment, assuming that Solomon uses straight$-$line

depreciation and double$-$declining$-$balance for financial and income tax reporting.

Note: Round your intermediate calculations and answers for "Net present value" to the nearest whole dollar amount.