The Popsee company is a soft drink company. Until today, the company bought empty cans from an outside supplier that charges $0.30 per can. Popsee is considering purchasing machine that will produce cans for only $0.10, for a savings of $0.20 per can.

The cost of a can machine is $3,600,000, and its life span is 12 years. The machine will be depreciated to a salvage value of zero and is not expected to sell the machine at the end of its life.

In order to make space for the new machine, the company will need to lease additional space for the new operation. The rent for the new space will cost the company $55,000 annually.

The cost of capital of PopseeCo is 11% and the corporate tax rate is 40%. The machine will be straight-line depreciated over 12 years to its terminal value.

Start by assuming that annual production is 5 million cans, and then answer the following questions:

1) what is the NPV and IRR of the project?

2) Using Goal Seek to find a break-even point (in volume). Include a screen shot of your Goal Seek parameters.

PLEASE SOLVE IN EXCEL AND GIVE FORMULATEXT TOO