You must evaluate the purchase of a proposed spectrometer for the R&D department. The base price is $270,000, and it would cost another $40,500 to modify the equipment for special use by the firm. The equipment falls into the MACRS 3-year class and would be sold after 3 years for $135,000. The applicable depreciation rates are 33%, 45%, 15%, and 7%. The equipment would require an $14,000 increase in net operating working capital (spare parts inventory). The project would have no effect on revenues, but it should save the firm $65,000 per year in before tax labor costs. The firm's marginal federal-plus-state tax rate is 40%. The data has been collected in the Microsoft Excel Online file below. Open the spreadsheet and perform the required analysis to answer the questions below. Open spreadsheet a. What is the initial investment outlay for the spectrometer, that is, what is the Year O project cash flow? Round your answer to the nearest cent. Negative amount should be indicated by a minus sign. Upen spidusteel a. What is the initial investment outlay for the spectrometer, that is, what is the Year 0 project cash flow? Round your answer to the nearest cent. Negative amount should be indicated by a minus sign. b. What are the project's annual cash flows in Years 1, 2, and 37 Round your answers to the nearest cent. In Year 1 $ In Year 2$ In Year 3 $ c. If the WACC is 10%, should the spectrometer be purchased? 3 Base price 4 Additional modification costs 5 Before tax salvage proceeds Change in NOWC 7 Before tax labor cost savings 8 WACC Tax rate $270,000 $40,500 $135,000 $14,000 $65,000 10.00% 40.00% Yr 0 Yr 2 12 Depreciation rates Yr 3 16 Base price 17 Modification costs 18 NOWC 19 S65 000.00 E 565,000.00 565 000.00 20 Before-tax labor cost savings 21 Depreciation 22 Operating income Taxes 24 After-tax operating income 25 Add back depreciation 26 Operating cash fows 50.00 $0.00 S000 5135.000.00 $14,000.00 28 Termination cash fows 29 Before-tax salvage proceeds 30 Tax on salvage value 31 NOWC recapture 32 Project cash flows 33 34 NPV 35 Project acceptance