- The nex equigenent will have a cost of $0,000,000, and it will be depreciated on a straight-line basis over a period of trx yoars fyears 1-6). - The old machine is alto being depreoated on a straight-line bassit. At has a book value of $200,000( at year 0) and four more yearn of depreoation lel (550,000 per year). - The new equipment will have a salvage value of s0 at the end of the aropecte life (vear 6). The old madia has a current ialvage value (at year 0 ) of $300,000. - Replaong the old machine will require en ieveetinent an net working capial (wwC) of $30,000 that will be recovered at the end of the project's life (vear 6). - The new madine is mare elicent, so the firmis incremental earrings before interest and tases (CEm) will incroase toy a total of $600,000 in each of the next sac years (yesrs 1-6). Hinti This value represents the sffference between the fevenues and operating coste (including deprepation expense) generated uniag the new equipment and thet eomed using the old squpmert. - The project's cent of capitai is 134.. - The tompany/s annuar tak rote is 30N. Corwelete the tallowing table and oompute the incremental cash fions assopated with the fepincemert of the old equ pment with the new equiperiert. of NME Tnal tire rash fisser The net pretent walue (RPV) of this replacement profed is! 05,37+607 34,515,488 55,312,339 -57,094,254 Then net present waiue (Pipy) of this replacement project ist 54,374,607 54515,468 55,312333 53,9+4,144 - ncaptiare af WC: Tokal free The net present v: \begin{tabular}{|l|l|} \hline$9,000,000 \\ \hline$600,000 \\ \hline59,760,000 \\ \hline$435,000 \\ \hline 4.515,4050 \\ \hline \end{tabular} Westione project is Recasture of TiWc Total free $6.374,607 5855,000 54,515,488 55,312339