Use the following data:

Base price is $95,000

$16,000 to modify

MACRS 3-year class property

Sold after THREE (3) years for $7,500

Additional Net Working Capital (NWC) required in the amount of $8,000

SAVINGS of $49,000 per year

Tax rate is 25.0000%

Cost of capital is 9.0000%

MACRS Recovery Allowance Percentages

Year

Ownership 3-Year 5-Year 7-Year

1 33.33 20.00 14.29

2 44.45 32.00 24.49

3 14.81 19.20 17.49

4 7.41 11.52 12.49

5 11.52 8.93

6 5.76 8.93

7 8.93

8 4.46

Find the following (Not Using Excel) using A time Line and 6 Decimal Places for all equations:

1. MIRR

2. PI 3. Will the company ACCEPT the project?

4. Why or why not?

Use the following data: Base price is $95,000 $16,000 to modify MACRS 3-year class property Sold after THREE (3) years for $7,500 Additional Net Working Capital (NWC) required in the amount of $8,000 SAVINGS of $49,000 per year Tax rate is 25.0000% Cost of capital is 9.0000%