Windhoek Mines, Limited, of Namibia, is contemplating the purchase of equipment to exploit a mineral deposit on land to which the

company has mineral rights. An engineering and cost analysis has been made, and it is expected that the following cash flows would

be associated with opening and operating a mine in the area:

Cost of new equipment and timbers

working capital required

Annual net cash receipts

Cost to construct new roads in three years

Salvage value of equipment in four years

$ 320,000

$ 195,000

$ 130,000*

$ 59,000

$ 84,000

*Receipts from sales of ore, less out-of-pocket costs for salaries, utilities, insurance, and so forth.

The mineral deposit would be exhausted after four years of mining. At that point, the working capital would be released for

reinvestment elsewhere. The company's required rate of return is 18%.

Click here to view Exhibit 12B-1 and Exhibit 12B-2, to determine the appropriate discount factors) using tables.

Problem 12-16 (Algo) Net Present Value Analysis (L012-2] Windhoek Mines Limited. of Namibia, is contemplating the purchase of equipment to exploita mineral deposit on land to which the company has mineral rights. An engineering and cost analysis has been made, and it is expected that the following cash flows would be associated with opening and operating a mine in the area Cost of new equipment and timbers $ 520,000 Working capital required $ 195,000 Annual net cash receipts 5.130.000 Cost to construct new roads in three years 5.59.000 Salvage value of equipment in four years $94.000 Receipts from sales of ore, less out of pocket costs for salaries utilities, insurance, and so forth The mineral deposit would be exhausted after four years of mining. At that point the working capital would be released for Teinvestment elsewhere. The company's required rate of return is 18% Click here to view Ext 2007 and Exh127 to determine the appropriate discount factors using tables Required a What is the net present Value of the proposed mining project Should the project be accepted Required: a What is the net present value of the proposed mining project? b. Should the project be accepted? Complete this question by entering your answers in the tabs below. Required A Required B What is the net present value of the proposed mining project? (Enter negative amount with a minus sign. Round your final answer to the nearest whole dollar amount Net present value Required B >