Solve using financial calculator only and please show all steps.

Your firm is considering the development of a new widget. The production of the widget calls for some new specialized equipment. Research into the project has developed the following estimates:

• The production equipment will have a 5-year MACRS depreciation and will be operational for 4 years at which time it will be sold
• The equipment will cost $800,000 to purchase
• Installation and training costs will be $100,000 after taxes
• Working capital will increase by $125,000 and will stay at that level over the life of the project
• Each widget can be sold for $42
• The variable cost of producing each widget is $26
• Fixed costs will be $250,000 per year
• Marketing estimates that the following units can be sold
  • Year 1 is 40,000 units Year 2 is 50,000 units Year 3 is 55,000 units
  • Year 4 is 35,000 units
• The firms tax rate is 20%
• At the end of the 4^th year, the equipment can be sold for $200,000 (Hint consider that there is still book value remaining).
• The firms WACC is 8.2%
• If the firm was not producing widgets, they could use the facilities on other projects which would generate EBIT of $60,000 per year.
• The critical acceptance level for PP is 2.5 years and for discounted PP it is 4 years

1. Calculate the after-tax cash flows for this project.
2. Using these cash flows, calculate the PP, discounted PP, IRR, MIRR, NPV and Eq. Annual NPV for the project. Make an accept/reject decision for each method. Then, make an overall accept/reject decision.