(Calculating project cash flows and? NPV)??Raymobile Motors is considering the purchase of a new production machine...

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(Calculating project cash flows and? NPV)??Raymobile Motors isconsidering the purchase of a new production machine for
$350,000.The purchase of this machine will result in an increasein earnings before interest and taxes of $ 200,000
per year. To operate this machine? properly, workers would haveto go through a brief training session that would cost $22,000
after tax. In? addition, it would cost ?$4,500 after tax toinstall this machine correctly. ? Also, because this machine isextremely? efficient, its purchase would necessitate an increase ininventory of ?$20,000. This machine has an expected life of 10
?years, after which it will have no salvage value. Assumesimplified? straight-line depreciation, that this machine is beingdepreciated down to? zero, a 33 percent marginal tax? rate, and arequired rate of return of 13 percent.
a.??What is the initial outlay associated with this?project?
b.??What are the annual? after-tax cash flows associated withthis project for years 1 through 9??
c.??What is the terminal cash flow in year 10 ?(that is, theannual? after-tax cash flow in year 10 plus any additional cashflows associated with termination of the? project)?
d.??Should this machine be? purchased?

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(Calculating project cash flows and? NPV)??Raymobile Motors isconsidering the purchase of a new production machine for$350,000.The purchase of this machine will result in an increasein earnings before interest and taxes of $ 200,000per year. To operate this machine? properly, workers would haveto go through a brief training session that would cost $22,000after tax. In? addition, it would cost ?$4,500 after tax toinstall this machine correctly. ? Also, because this machine isextremely? efficient, its purchase would necessitate an increase ininventory of ?$20,000. This machine has an expected life of 10?years, after which it will have no salvage value. Assumesimplified? straight-line depreciation, that this machine is beingdepreciated down to? zero, a 33 percent marginal tax? rate, and arequired rate of return of 13 percent.a.??What is the initial outlay associated with this?project?b.??What are the annual? after-tax cash flows associated withthis project for years 1 through 9??c.??What is the terminal cash flow in year 10 ?(that is, theannual? after-tax cash flow in year 10 plus any additional cashflows associated with termination of the? project)?d.??Should this machine be? purchased?