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Please help with the answers to this! Thanks TIP: Apply the depreciation ccounting formulation...

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Accounting

imagePlease help with the answers to this! Thanks

TIP: Apply the depreciation ccounting formulation from hapter 2 of the textbook. 600 400 10 12 14 16 18 20 Question #5 Cash flow table (34%): An investment alternative in an engineering project requires a capital cost (to purchase and install equipment) of $72 million payed at time zero. The investment will produce a stream of revenue of $48 million per yearend over a 6-year period with operating costs of $22 Ignore inflatior million per yearend for the first three years and $25 million per yearend for the remaining three years. Use straight-line depreciation for the capital cost over the project lifespan. The rate of taxation on the income is 35% (this is the part of the {annual income} = {revenue} - {cost}, payable to the government annually, show your calculations & state your assumptions i) Construct the cash flow table, calculate the after-tax annual cash flows (ATCF), and determine the payback period, based on these ATCF; ii) Calculate the present worth, PW, for this project, based on the ATCF, assuming an 8% discount rate, based on the weighted average cost of capital of the company. 14% 20%

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