$\backslash$table$[[$Equipment$,$$$20,500,000,,,,],[$Pretax salvage value,$$4,500,000,,,,],[R$&$D,$$$750,000,,,,],[$Marketing study,$$200,000,,,,],[,$ Yeat $1_{?},$ Year $2_{?},$ Year $3_{?},$ Year $4_{?},\frac{\text{Y}\text{e}\text{a}\text{r}5}{0000}$Equipment $$20,500,000$

Pretax salvage value $$4,500,000$

R&D $$750,000$

Marketing study $$200,000$

Year $1$ Year $2$ Year $3$ Year $4$ Year $5$

Sales $($units$)840009900013000011000090000$

Sales of old PDA $8000060000$

Lost sales $1500015000$

Depreciation rate $14\mathrm{.}29\%24\mathrm{.}49\%17\mathrm{.}49\%12\mathrm{.}49\%8\mathrm{.}93\%$

Price $$380$

VC $$165$

FC $$4,900,000$

Price of old PDA $$310$

Price reduction

of old PDA $$55$

VC of old PDA $$120$

Tax rate $21\%$

NWC percentage $20\%$

Required return $12\%$

Sales Year $1$ Year $2$ Year $3$ Year $4$ Year $5$

New Sales

Lost sales

Lost revenue

Net sales

VC

New

Lost sales

Total VC

Sales

VC

Fixed costs

Dep

EBT

Tax

NI

$+$Dep

OCF

NWC

Beg

End

NWC CF

Net CF

Salvage

BV of equipment

Taxes

Salvage CF

Time Cash flow

$0$

$1$

$2$

$3$

$4$

$5$