The Molding Department of General Santos, Inc. doing an investigation for the possibility of acquiring a new unit of equipment at the amount of $120,000. Cash cost savings before income tax from the use of this equipment has been estimated at $50,000 a year for a period of 4 years. At the end of 4 years, the equipment will have no salvage value. The minimum acceptable rate is 12% discounted rate.

Requirements:

1. Calculate the NPV under straight-line depreciation
2. Calculate the NPV under SYD depreciation.
3. Explain how bookkeeping method can help to improve the rating of a capital investment project.