#5 A& B

JUST #5 PLEASE I already post #4!!

Ilana Industries Incorporated needs a new lathe. It can buy a new high-speed lathe for $1million. The lathe will cost $35,000 per year to run, but it will save the firm $125,000 in labor costs and will be useful for 10 years. Suppose that, for tax purposes, the lathe is entitled to 100% bonus depreciation. At the end of the 10 years, the lathe can be sold for $100,000. The discount rate is 8%, and the corporate tax rate is 21%. What is the NPV of buying the new lathe? Note: A negative amount should be indicated by a minus sign. Enter your answer in dollars not in millions. Do not round intermediate calculations. Round your answer to 2 decimal places. A project currently generates sales of $10 million, variable costs equal 50% of sales, and fixed costs are $2 mililion. The firm's tax rate is 21%. Assume all sales and expenses are cash items. a. What are the effects on cash flow, if sales increase from $10 million to $11 million? b. What are the effects on cash flow, if variable costs increase to 65% of sales? Complete this question by entering your answers in the tabs below. What are the effects on cash flow, if sales increase from $10 million to $11 million? Note: Input the amount as positive value. Enter your answer in dollars not in millions. Problem 10-5 Sensitivity Analysis (LO3) A project currently generates sales of $10 million, variable costs equal 50% of sales, and fixed costs are $2 million. The firm's tax rate is 21%. Assume all sales and expenses are cash items. a. What are the effects on cash flow, if sales increase from $10 million to $11 million? b. What are the effects on cash flow, if variable costs increase to 65% of sales? Complete this question by entering your answers in the tabs below. What are the effects on cash flow, if variable costs increase to 65% of sales? Note: Input the amount as positive value. Enter your answer in dollars not in millions