21. please answer this quesrtion

question ZI 15 points Save Answer Total marks ( 15 marks) Aussie Designs has been rebuilding Model 100, Model 120 and Model 150 Kicker subwoofers that were returned for warranty action. Customers returning the subwoofers receive a new replacement. The warranty returns are then rebuilt and resold (as seconds). Tent sales are often used to sell the rebuilt speakers. As part of the rebuilding process, the speakers are demagnetised so that metal pieces and shavings can be removed. A demagnetising (demag) machine is used to achieve this objective. A product design change has made the most recent Model 150 speakers too tall to fit into the demag machine. Aussie Designs has two alternatives that it is currently considering. First, a new demag machine can be bought that has a different design, eliminating the fit problem. The cost of this machine is $600 000 and it will last five years. Second, Aussie can keep the current machine and sell the 150 speakers for scrap, using the old demag machine for the Model 100 and 120 speakers only. A rebuilt speaker sells for $295 and costs $274.65 to rebuild (for materials, labour and overhead cash outlays). The $274.65 outlay includes the annual operating cash effects of the new demag machine. If not rebuilt, the Model 150 speakers can be sold for $4 each as scrap. There are 10 000 Model 150 warranty returns per year. Assume that the required rate of return is 10%. REQUIRED: a. Determine which alternative is the best for Aussie Designs by using NPV analysis.( 12 marks) b. What qualitative factors should be considered before making the decision as you have indicated in ( a)? Provide 2 factors that are relevant to the case. ( 3 marks) PRESENT VALUE OF A SINGLE Amount ( $ 1) discounted year factor 10% 1 0.90 2 0.82 13 0.75 4 0.68 15 0.62 0.56 or the toolbar press AL THE10 (PC) or AL THEN+F10 (Mac)