A quaint but well-established coffee shop, the Hot New Café,wants to build a new café for increased capacity. Consider thefollowing financial aspects of this endeavor: Expected sales are$800,000 for the first 5 years. Direct costs, including labor andmaterials, will be 50% of sales. Indirect costs are estimated at$200,000 a year. The cost of the building for the new café will bea total of $850,000, which will be depreciated straight line overthe next 5 years. The firm's marginal tax rate is 38%, and its costof capital is 10%. For this assignment, you need to develop acapital budget. It is important to know what the café managersshould consider within their capital budget. You must also definethe key terms necessary to understand capital budgeting. In thisassignment, please show all work, including formulae andcalculations used to arrive at financial values. You must answerthe following using the information above: Prepare a capital budgetfor the Hot New Café with the net cash flows for this project overa 5-year period. Calculate the payback period (P/B) and the netpresent value (NPV) for the project. Answer the following questionsbased on your P/B and NPV calculations: Do you think the projectshould be accepted? Why? Define and describe net present value(NPV) as it pertains to the new cafe. Assume the company has a P/B(payback) policy of not accepting projects with a life of over 3years. Do you think the project should be accepted? Why?