Venu Industries is deciding whether to automate one phase of its production process. The manufacturing equipment has a six-year life and will cost $920,000. 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 14% 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 = 14%) Present Value Years i Data Table 1 2 3 4 5 Present value of each year's inflow: (n = 1) (n=2) (n = 3) (n = 4) (n = 5) (n = 6) Total PV of cash inflows Year 1 $ Year 2 Year 3 263,000 250,000 222,000 214,000 Year 4 Year 5 201,000 Year 6 175,000 0 Initial investment Print Done Net present value of the project Enter any number in the edit fields and then continue to the next question. 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 $50,000 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.) Present Cash (outflow)/inflow PV Factor (i = 14%) 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 The refurbishment provides a NPV. The refurbishment NPV is to overcome the original NPV of the equipment. Therefore, the refurbishment Valter Venu Industries' original decision regarding the equipment investment. Enter any number in the edit fields and then continue to the next question. Present Value of $1 0.792 | Periods | 1% | 2% | 3% | 4% | 5% | 6% | 7% | 8% | 9% | 10% | 12% | 14% | 15% | 16% | 18% | 20% 0.990 | 0.980 | 0.971 10.962 | 10.952 10.943 10.935 10.926 | 10.917 10.909 10.893 10.877 0.870 10.862 10.847 10.833 0.980 0.961 0.943 0.925 0.907 10.890 | 0.873 0.857 10.842 0.826 10.797 0.769 0.756 10.743 | 0.718 0.694 0.971 0.942 0.915 0.889 0.864 0.840 | 0.816 0.794 0.772 0.751 10.712 0.675 0.658 10.641 | 0.609 10.579 0.961 0.924 0.888 0.855 0.823 0.763 0.735 0.708 0.683 0.636 0.592 0.572 0.552 0.516 0.482 0.951 0.906 0.863 10.822 0.784 10.747 0.713 0.681 0.650 0.621 10.567 10.519 | 0.497 | 0.476 10.437 0.402 0.942 | 0.888 10.837 10.790 | 0.746 10.705 0.666 0.630 0.596 10.564 10.507 | 10.456 0.432 10.410 0.370 | 0.335 0.933 0.871 0.813 0.760 0.711 0.665 0.623 | 0.583 | 0.547 | 0.513 | 0.452 | 0.400 | 0.376 | 0.354 | 0.314 0.279 0.923 | 0.853 10.789 10.731 | 0.677 10.627 0.582 | 0.540 10.502 10.467 10.404 10.35110.327 10.305 | 10.266 0.233 0.914 | 0.837 | 0.766 | 0.703 | 0.645 | 0.592 0.544 | 0.500 l 0.460 l 0.424 | 0.361 | 0.308 10.284 10.263 0.225 | 0.194 0.905 0.820 10.744 | 0.676 | 0.614 | 0.558 0.508 0.463 0.422 0.386 0.322 10.270 0.247 10.227 10.191 10.162 0.896 0.804 0.722 0.650 0.585 10.527 0.475 | 0.429 10.388 | 0.350 0.287 0.237 0.215 10.195 0.162 10.135 0.887 0.788 0.701 0.625 0.557 0.497 0.444 | 0.397 10.356 10.319 0.257 0.208 0.187 0.168 | 0.137 0.112 0.879 0.773 0.681 0.601 0.530 10.469 0.415 | 0.368 0.326 0.290 0.229 0.182 0.163 0.145 0.116 10.093 0.870 0.758 0.661 0.577 0.505 0.442 0.388 | 0.340 | 0.299 10.263 0.205 0.160 0.141 10.125 0.099 10.078 0.861 0.743 | 0.642 10.555 | 0.481 | 0.417 0.362 | 0.315 10.275 0.239 | 0.183 10.140 | 0.123 | 0.108 | 0.084 10.065 0.853 0.728 0.623 10.534 0.458 0.394 10.339 | 0.292 10.252 0.218 0.163 0.123 0.107 0.093 0.071 0.054 0.844 0.714 | 0.605 | 0.513 | 0.436 | 0.371 0.317 0.270 0.231 0.198 0.146 0.108 0.093 0.080 0.060 0.045 0.836 0.700 0.587 0.494 0.416 0.350 0.296 0.250 0.212 0.180 0.130 0.095 | 0.081 10.069 0.051 0.038 0.828 0.686 | 0.570 | 0.475 | 0.396 | 0.331 0.277 | 0.232 0.194 0.164 0.116 0.083 0.070 0.060 0.043 10.031 0.820 0.673 | 0.554 | 0.456 | 0.377 10.312 0.258 0.215 10.178 10.149 0.104 10.073 0.061 10.051 10.037 0.026 0.811 0.660 | 0.538 | 0.439 | 0.359 | 0.294 0.242 0.199 0.164 0.135 0.093 0.064 0.053 10.044 0.031 0.022 0.803 0.647 | 0.522 | 0.422 | 0.342 | 0.278 10.226 10.184 | 0.150 | 0.123 | 0.083 | 0.056 | 0.046 | 10.038 0.026 0.018 10.795 10.634 | 0.507 | 0.406 10.326 | 0.262 10.211 | 0.170 | 0.138 | 0.112 10.074 | 0.049 10.040 | 0.033 | 0.022 | 0.015. 56789 7890 H28466MB9%a88 Present Value of Ordinary Annuity of $1 Periods 18% 0.847 1.566 1% 0.990 1.970 2.941 3.902 4.853 2% 0.980 1.942 2.884 3.808 4.713 3% 0.971 1.913 2.829 3.717 4.580 4% 0.962 1.886 2.775 3.630 4.452 5% 0.952 1.859 2.723 3.546 4.329 6% 0.943 1.833 2.673 3.465 4.212 7% 0.935 1.808 2.624 3.387 4.100 8% 0.926 1.783 2.577 3.312 3.993 9% 10% 0.917 | 0.909 1.759 1.736 2.531 2.487 3.240 3.170 3.890 3.791 12% 0.893 1.690 2.402 3.037 3.605 14% 0.877 1.647 2.322 2.914 3.433 15% 0.870 1.626 2.283 2.855 3.352 16% 0.862 1.605 2.246 2.798 3.274 20% 0.833 1.528 2.106 2.589 2.991 2.174 2.690 3.127 O oo vou 5.795 6.728 7.652 8.566 9.471 5.601 5.417 5.242 6.472 6.230 6.002 7.325 7.020 6.733 | 8.162 | 7.786 | 7.435 8.983 8.530 8.111 5.076 5.786 6.463 7.108 7.722 4.917 | 4.767 5.582 5.389 6.210 5.971 6.802 | 6.515 7.360 7.024 4.623 5.206 5.747 6.247 6.710 4.486 5.033 5.535 5.995 6.418 4.355 4.868 5.335 5.759 6.145 4.111 4.564 4.968 5.328 5.650 3.889 4.288 4.639 4.946 5.216 3.784 4.160 4.487 4.772 5.019 3.685 4.039 4.344 | 4.607 4.833 3.498 3.812 4.078 4.303 4.494 3.326 3.605 3.837 4.031 4.192 5.453 5.660 5.842 6.002 6.142 5.234 5.421 5.583 5.724 5.847 5.029 5.197 5.342 5.468 5.575 4.656 4.793 4.910 5.008 5.092 4.327 4.439 4.533 4.611 4.675 16 10.368 9.787 9.253 8.760 8.306 7.887 7.499 7.139 6.805 6.495 5.938 11.255 10.575 9.954 9.385 8.863 8.384 7.943 7.536 7.161 6.814 6.194 12.134 | 11.348 10.635 | 9.986 | 9.394 | 8.853 8.358 7.904 7.487 7.103 6.424 13.004 | 12.106 11.296 10.563 | 9.899 | 9.295 | 8.745 8.244 7.786 7.367 6.628 13.865 12.849 11.938 | 11.118 | 10.380 | 9.712 9.108 8.559 8.061 7.606 6.811 14.718 13.578 12.561 11.652 10.838 10.106 9.447 8.851 8.313 7.824 6.974 15.562 14.292 13.166 | 12.166 11.274 10.477 9.763 9.122 8.544 8.022 7.120 16.398 14.992 13.754 12.659 11.690 10.828 9.372 8.756 8.201 7.250 17.226 15.678 14.324 13.134 12.085 11.158 10.336 9.604 8.950 8.365 7.366 18.046 14.877 13.590 12.462 11.470 10.594 9.818 9.129 8.514 7.469 18.857 17.011 15.415 14.029 12.821 | 11.764 10.836 10.017 9.292 8.649 7.562 19.660 17.658 15.937 | 14.451 | 13.163 | 12.042 | 11.061 10.2019.442 7.645 20.456 | 18.292 | 16.444 | 14.857 | 13.489 | 12.303 | 11.272 | 10.371 | 9.580 | 8.883 | 7.718 6.265 6.373 6.467 6.550 6.623 5.954 6.047 6.128 6.198 6.259 5.669 5.749 5.818 5.877 5.929 5.162 5.222 5.273 5.316 5.353 4.730 4.775 4.812 4.844 4.870 21 8.772 6.687 6.312 6.743 6.359 6.792 | 6.399 5.973 5.384 4.891 6.011 5.410 4.909 6.044 | 5.432 | 4.925