Vernon Company has been offered a seven-year contract to supply a part for the military. After careful study, the company has estimated the following data relating to the contract: Cost of Equipment Needed $300,000 Working Capital Needed $ 50.000 Annual Cash Receipts from the Delivery of Parts. Less Cash Operating Costs $ 70.000 Salvage Value of Equipment at Termination of the $ 5,000 Contract It is not expected that the contract would be extended beyond the initial contract period. The company's discount rate is 10%. (Ignore income taxes in this problem.) Required: Use the net present value method to determine if the contract should be accepted. Complete the chart below showing the individual items and their present values in order. to calculate the net present value of this investment. Round all computations to the nearest dollar. Would you advise Vernon to make this investment? Why? Item Years Cash Flow PV