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You must evaluate the purchase of a proposed spectrometer for the R8D department, The purchase price of the spectrometer including modifications is $180,000, and the

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You must evaluate the purchase of a proposed spectrometer for the R8D department, The purchase price of the spectrometer including modifications is $180,000, and the equipment will be fully depreciated at the time of purchase. The equipment would be sold after 3 years for $22,000. The equiprent would requlre an 511,000 increase in net operating working capital (spare parts inventory). The project would have no effect on revenues, but it should save the firm 575,000 per vear in before-tax labor costs. The firm's marginal federal-plus-state tax rate is 25\%. a. What is the initial investment outiay for the spectrometer after bonus depreciation is considered, that is, what is the Year 0 project eash fiow? Enter your answer as a positive value. Round your answer to the nearest dollar. b. What are the project's annual cash fows in Years 1,2 , and 3 ? Do not round intermediate calculations. Aound your answers to the nearest dollar. Year 1 is Vear 2:1 Year 3:1 c. If the WACC is 12%, should the spectrometer be purchased? You must evaluate the purchase of a proposed spectrometer for the RsD department. The purchase price of the spectrometer including modifications is $180,000, and the equipment will be fully depreciated at the time of purchase. The equipment would be sold after 3 years for $22,000. The equipment would require an $11,000 increase in net operating working capital (spare parts inventory). The project would have no effect on revenues, but it should save the firm 575,000 per year in before-tax laber costs. The firm's marginal federal-plus-state tax rate is 25%. a. What is the initiar investment outlay for the spectrometer after bonus depreciation is considered, that is, what is the Year 0 project cash flow? Enter your answer as a positive value. Round your answer to the nearest dollac, b. What are the project's annual cash flows in Years 1,2 , and 37 Do not round intermediate calculations. Round your answers to the nearest doliar. Year 1:5 Year 2:5 Year 3: 5 c. If the WACC is 12%, should the spectrometer be purchased

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