Venu Industries is deciding whether to automate one phase of its production process. The manufacturing equipment has a six-year life and will cost $905,000. Projected net cash inflows are as follows: (Click the icon to view the projected net cash inflows.) (Click the icon to view Present Value of $1 table.) (Click the icon to view Present Value of Ordinary Annuity of $1 table.) Read the requirements. Requirement 1. Compute this project's NPV using Venu's 16% hurdle rate. Should Venu invest in the equipment? Use the following table to calculate the net present value of the project. (Enter any factor amounts to three decimal places, X.XXX. Use parentheses or a minus sign for a negative net present value.) Years - Data table Year 1 Present va Requirements Year 2 Present va Year 3 Present va Year 1 $ 262,000 Year 4 Present va Year 2 254,000 Year 5 Present va Year 3 Year 6 Present val 226,000 211,000 1. Compute this project's NPV using Venu's 16% hurdle rate. Should Venu invest in the equipment? 2. Venu could refurbish the equipment at the end of six years for $102,000. The refurbished equipment could be used one more year, providing $73,000 of net cash inflows in year 7. Additionally, the refurbishe equipment would $52,000 residual value at the end of year 7. Should Venu invest in the equipment and refurbish it after six years? (Hint: In addition to your answer to Requirement 1, discount the additional cash outflow and inflows back to the present value.) Year 4 Total PV of Year 5 201,000 Year 0 Initial inve Year 6 174,000 Net presen Venu Industries Print Done Print Done Requirement 2. Ven $52,000 residual valu ar 7. Additionally, the refurbished equipment would have a sh outflow and inflows back to the present value.) Venu Industries is deciding whether to automate one phase of its production process. The manufacturing equipment has a six-year life and will cost $905,000. Projected net cash inflows are as follows: E: (Click the icon to view the projected net cash inflows.) (Click the icon to view Present Value of $1 table.) (Click the icon to view Present Value of Ordinary Annuity of $1 table.) Read the requirements Requirement 1. Compute this project's NPV using Venu's 16% hurdle rate. Should Venu invest in the equipment? Use the following table to calculate the net present value of the project. (Enter any factor amounts to three decimal places, X.XXX. Use parentheses or a minus sign for a negative net present value.) Net Cash Inflow PV Factor (i = 16%) Years Present Value Year 1 Present value of each year's inflow: (n = 1) Year 2 Present value of each year's inflow: (n = 2) Year 3 Present value of each year's inflow: (n = 3) Year 4 Present value of each year's inflow: (n = 4) Year 5 Present value of each year's inflow: (n = 5) Year 6 Present value of each year's inflow: (n = 6) Total PV of cash inflows Year 0 Initial investment Net present value of the project Venu Industries invest in the equipment. Requirement 2. Venu could refurbish the equipment at the end of six years for $102,000. The refurbished equipment could be used one more year, providing $73,000 of net cash inflows in year 7. Additionally, the refurbished equipment would have a $52,000 residual value at the end of year 7. Should Venu invest in the equipment and refurbish it after six years? (Hint: In addition to your answer to Requirement 1, discount the additional cash outflow and inflows back to the present value.) Venu Industries is deciding whether to automate one phase of its production process. The manufacturing equipment has a six-year life and will cost $905,000. Projected net cash inflows are as follows: (Click the icon to view the projected net cash inflows.) (Click the icon to view Present Value of $1 table.) (Click the icon to view Present Value of Ordinary Annuity of $1 table.) Read the requirements "I WIL VUUt vi vil yul"." Year 6 Present value of each year's inflow: (n = 6) Total PV of cash inflows Year 0 Initial investment Net present value of the project Venu Industries invest in the equipment. Requirement 2. Venu could refurbish the equipment at the end of six years for $102,000. The refurbished equipment could be used one more year, providing $73,000 of net cash inflows in year 7. Additionally, the refurbished equipment would have a $52,000 residual value at the end of year 7. Should Venu invest in the equipment and refurbish it after six years? (Hint: In addition to your answer to Requirement 1, discount the additional cash outflow and inflows back to the present value.) Calculate the NPV of the refurbishment (Enter any factor amounts to three decimal places, X.XXX. Use parentheses or a minus sign for cash outflows and for a negative net present value.) Cash PV Factor (i = (outflow)/inflow 16%) Present Value Refurbishment at the end of Year 6 (n = 6) Cash inflows in Year 7 (n = 7) Residual value (n = 7) Net present value of the refurbishment NPV. The refurbishment NPV is V to overcome the original NPV of the equipment. Therefore, the refurbishment Valter Venu Industries' original decision regarding the equipment The refurbishment provides a investment