Question: Can you please show the work besides using EXCEL or a Finance Calculator? I need to know how to do it by hand for the

Can you please show the work besides using EXCEL or a Finance Calculator? I need to know how to do it by hand for the upcoming Exam!
Mr. Willams is a CEO of PineappleVille, Inc., a firm that manufactures high quality pens and produces apples and pineapples. Williams is considering replacing an old pineapple picking machine, which was bought for $2.5 million five years ago, with a new semi-auto pineapple picking machine. The new machine can be purchased for $3 million and it costs $250,000 to have it delivered and installed today. When the old machine was purchased five years ago, the machine was to be depreciated according to a 5-year MACRs schedule. Taro believes that the old machine can be sold for $200,000 today if the firm decides to replace it with the new one. The new machine will be depreciated using the straight-line method over a 5 year life. The projected sales of pineapples harvested by the new machine will be $850,000 per year. Total costs are $115,000 per year. After 5 years, the firm will stop pineapple production and sell the machine for $350,000. The project requires an initial investment in net working capital of $200,000. PPAP's tax rate is 21 percent. CF at Year 0= -$3,261,760 OCF= $702,450 Net CF=$1,252,450 What is the NPV? MUST SHOW WORK
Step by Step Solution
There are 3 Steps involved in it
Get step-by-step solutions from verified subject matter experts
