The new equipment will have a cost of $$1,200,000,$ and it will be depreciated on a straight$-$line basis over a period of six years $($years $16).$

The old machine is also being depreciated on a straight$-$line basis. It has a book value of $$200,000($at year $0)$ and four more years of depreciation left $($$$50,000$ per year$).$

The new equipment will have a salvage value of $$0$ at the end of the project's life $($year $6).$ The old machine has a current salvage value $($at year $0)$ of $$300,000.$

Replacing the old machine will require an investment in net working capital $($NWC$)$ of $$20,000$ that will be recovered at the end of the project's life $($year $6).$

The new machine is more efficient, so the firm$$s incremental earnings before interest and taxes $($EBIT$)$ will increase by a total of $$700,000$ in each of the next six years $($years $16).$ Hint: This value represents the difference between the revenues and operating costs $($including depreciation expense$)$ generated using the new equipment and that earned using the old equipment.

The project's cost of capital is $13\%.$

The company's annual tax rate is $30\%.$

Please complete the table and solve for NPV