Use Exhibit 12B 1 and Exhibit 12B 2 to locate the present value of an annuity of S1, which is the amount to be multiplied tines the future annual cash flow amount. Each of the following scenarios is independent. Assume that all cash flows are after-tax cash flows. a, Campbell Manufacturing is considering the purchase of a new welding system. The cash benefits will be $480,000 per year. The system costs $2,450,000 and will last 10 years. b. Evee Cardenas is interested in investing in a women's specialty shop. The cost of the investment is $330,000. She estimates that the return from owning her own shop will be $50,000 per year. She estimates that the shop will have a useful life of 6 years c Barker Company calculated the NPV o a pro ect and ound it to be 53 900 The pro e s life as estimated to be 8 years. The equired rate o return used or the NP as 10%. The ect was expected to produce annual a er tax cash calcu ation flows of $135,000. Required: 1 Compute the NPV for Campbell Manufacturing, assuming a discount rate af 12%. If required round all present value calculat ans to the nearest dollar. Use the minussign to indicate a negative NP. Should the company buy the new welding system? Yes 2. Conceptual Connection: Assuming a required rate of return of 8% calculate the NPV for Evee Cardenas' investment Round to the nearest dollar. If required round all present value calculations to the nearest dollar. Use the minus sign to indicate a negative NPV Should she invest? Yes What if the estimated return was $135,000 per year? Calculate the new NPV for Evee Cardenas' investment. Would this affect the decision? What does this tell you about your analysis? Round to the nearest dallar The shop should now b purchased. This reveals that the decision to accept or reject in this case is affected by differences in estimated investment What was the required investment for Barker Company's project? Round to the nearest dollar. If required, round all present value calculations to the nearest dollar 3