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The Campbell Company is considering adding a robotic paint sprayer to its production line. The sprayer's base price is $1,020,000, and it would cost another

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The Campbell Company is considering adding a robotic paint sprayer to its production line. The sprayer's base price is $1,020,000, and it would cost another $19,500 to install it. The machine falis into the MACRS 3 -year class, and it would be sold after 3 years for $492,000. The MaCRS rates for the first three years are 0.3333,0.4445, and 0.1481. The machine would require an increase in net working capital (inventory) of $18,000. The sprayer would not change revenues. but it is expected to save the firm $358,000 per year in before-tax operating costs, mainly labor. Campbeli's marginal tax rate is 25%. (Ignore the half-year convention for the straight-line method.) Cash outfiows, If any, should be indicated by a minus sign. Do not round intermediate calculations. Round your answers to the nearest dollar. a. What is the Year-0 net cash flow? 1 b. What are the project recurring cash flows in Years 1,2 , and 3 ? Year 1: $ Year 2: $ Year 3:$ c. What is the additional Year-3 cash flow (i.e, the after-tax salvage and the return of working capital)? 5 d. If the project's cost of capital is 15%, what is the NPV of the project? 5 The president of your company, MorChuck Enterprises, has asked you to evaluate the proposed acquisition of a new chromatograph for the fim's Rsb department. The equipment's basic price is $74,000, and it would cost another $16,000 to modify it for special use by your firm. The chromatograph, which falis into the MACRS 3-year class, would be sold after 3 years for 532,900 . The MACRS rates for the first three years are 0.3333,0.4445 and 0.1481. Use of the equipment would require an increase in net working capital (spare parts inventory) of $2,760. The machine would have no effect on revenues, but it is expected to save the firm $27,920 per year in before-tax operating costs, mainly labor, The firm's marginal federal-plus-state tax rate is 25\%. Cash outfows and negative NPV value, if any, should be indicated by a minus sign. Do not round intermediate calculations. Round your answers to the nearest dollar, a. What is the Year-0 net chsh flow

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