XYZ Company is considering purchasing a piece of equipment costing $400,000. It has a useful life of 4years and will be depreciated straight-line to zero, after which it will be scrapped for $30,000. This piece of equipment will save $150,000 per year in pretax operating costs during its useful life but requires an initial investment in NWC of $36,000. XYZ Company has a 21% tax rate and a required rate of return of 12%

What is the annual Operating Cash Flow (OCF) of this piece of equipment in Years 1-4?

What is the Year 4IATCF (Income After-Tax Cash Flow)?

What is the NPV of purchasing this piece of equipment?

Should XYZ Company take on this project?

What is the project's EAC?