$\backslash (\{\}^\{1\}\backslash )$ Click the icon to view the MACRS depreciation schedules.

$\backslash (\{\}^\{2\}\backslash )$ Click the icon to view the interest factors for discrete compounding when $\backslash ($ i$=7\backslash \%\backslash )$ per year.

$($a$)$ Using the generalized cash flow approach, determine the cash flow after taxes. Fill in the table below. $($Round to the nearest dollar.$)$

$($b$)$ Rework part $($a$),$ assuming that the entire investment would be financed by a bank loan at an interest rate of $\backslash (7\backslash \%\backslash ).$ Fill in the table below. $($Round to the nearest dollar.$)$

$($c$)$ Given a choice between the financing methods of parts $($a$)$ and $($b$),$ show calculations to justify your choice of which is the better one at an interest rate of $\backslash (7\backslash \%\backslash ).$

The NPW of the project financed by own funds is $\backslash$$ $.($Round to the nearest dollar.$)$

The NPW of the project financed by a bank loan is $\backslash (\backslash$$ $\backslash ).($Round to the nearest dollar.$)$

Which project would be selected? Choose the correct answer below.

The project financed by a bank loan.

The project financed by own funds. $1$: More Info

$*$Year to switch from declining balance to straight line

$2$: More Info

$\backslash$begin$\{$tabular$\}\{|$c$|$c$|$c$|$c$|$c$|$c$|$c$|\}$

$\backslash$hline & $\backslash$multicolumn$\{2\}\{|$l$|\}\{$Single Payment$\}$ & $\backslash$multicolumn$\{4\}\{|$c$|\}\{$Equal Payment Series$\}\backslash \backslash$

$\backslash$hline N & $\backslash$begin$\{$tabular$\}\{$l$\}$

Compound $\backslash \backslash$

Amount $\backslash \backslash$

Factor $\backslash \backslash$

$($F$/$P$,$ i$,$ N$)$

$\backslash$end$\{$tabular$\}$ & $\backslash$begin$\{$tabular$\}\{$l$\}$

Present $\backslash \backslash$

Worth $\backslash \backslash$

Factor $\backslash \backslash$

$($P$/$F$,$ i$,$ N$)$

$\backslash$end$\{$tabular$\}$ & $\backslash$begin$\{$tabular$\}\{$l$\}$

Compound $\backslash \backslash$

Amount $\backslash \backslash$

Factor $\backslash \backslash$

$($F$/$A$,$ i$,$ N$)$

$\backslash$end$\{$tabular$\}$ & $\backslash$begin$\{$tabular$\}\{$l$\}$

Sinking $\backslash \backslash$

Fund $\backslash \backslash$

Factor $\backslash \backslash$

$($A$/$F$,$ i$,$ N$)$

$\backslash$end$\{$tabular$\}$ & $\backslash$begin$\{$tabular$\}\{$l$\}$

Present $\backslash \backslash$

Worth $\backslash \backslash$

Factor

$\backslash [$

$($P $/$ A$,$ i$,$ N$)$

$\backslash ]$

$\backslash$end$\{$tabular$\}$ & $\backslash$begin$\{$tabular$\}\{$l$\}$

Capital $\backslash \backslash$

Recovery $\backslash \backslash$

Factor $\backslash \backslash$

$($A$/$P$,$ i$,$ N$)$

$\backslash$end$\{$tabular$\}\backslash \backslash$

$\backslash$hline $1$ & $1\mathrm{.}0700$ & $0\mathrm{.}9346$ & $1\mathrm{.}0000$ & $1\mathrm{.}0000$ & $0\mathrm{.}9346$ & $1\mathrm{.}0700\backslash \backslash$

$\backslash$hline $2$ & $1\mathrm{.}1449$ & $0\mathrm{.}8734$ & $2\mathrm{.}0700$ & $0\mathrm{.}4831$ & $1\mathrm{.}8080$ & $0\mathrm{.}5531\backslash \backslash$

$\backslash$hline $3$ & $1\mathrm{.}2250$ & $0\mathrm{.}8163$ & $3\mathrm{.}2149$ & $0\mathrm{.}3111$ & $2\mathrm{.}6243$ & $0\mathrm{.}3811\backslash \backslash$

$\backslash$hline $4$ & $1\mathrm{.}3108$ & $0\mathrm{.}7629$ & $4\mathrm{.}4399$ & $0\mathrm{.}2252$ & $3\mathrm{.}3872$ & $0\mathrm{.}2952\backslash \backslash$

$\backslash$hline $5$ & $1\mathrm{.}4026$ & $0\mathrm{.}7130$ & $5\mathrm{.}7507$ & $0\mathrm{.}1739$ & $4\mathrm{.}1002$ & $0\mathrm{.}2439\backslash \backslash$

$\backslash$hline $6$ & $1\mathrm{.}5007$ & $0\mathrm{.}6663$ & $7\mathrm{.}1533$ & $0\mathrm{.}1398$ & $4\mathrm{.}7665$ & $0\mathrm{.}2098\backslash \backslash$

$\backslash$hline $7$ & $1\mathrm{.}6058$ & $0\mathrm{.}6227$ & $8\mathrm{.}6540$ & $0\mathrm{.}1156$ & $5\mathrm{.}3893$ & $0\mathrm{.}1856\backslash \backslash$

$\backslash$hline $8$ & $1\mathrm{.}7182$ & $0\mathrm{.}5820$ & $10\mathrm{.}2598$ & $0\mathrm{.}0975$ & $5\mathrm{.}9713$ & $0\mathrm{.}1675\backslash \backslash$

$\backslash$hline $9$ & $1\mathrm{.}8385$ & $0\mathrm{.}5439$ & $11\mathrm{.}9780$ & $0\mathrm{.}0835$ & $6\mathrm{.}5152$ & $0\mathrm{.}1535\backslash \backslash$

$\backslash$hline $10$ & $1\mathrm{.}9672$ & $0\mathrm{.}5083$ & $13\mathrm{.}8164$ & $0\mathrm{.}0724$ & $7\mathrm{.}0236$ & $0\mathrm{.}1424\backslash \backslash$

$\backslash$hline

$\backslash$end$\{$tabular$\}$