CH. Assignment-Cash How Estimation and Risk Analysis McFann Co, is considering an investment that will have the following sales, variable costs, and fixed operating costs: Year 4 Year 2 4,000 Year 3 4,200 Unit sales 4,250 Sales price $39.88 $40.15 $41.55 Year 1 3,500 $38.50 $22.34 $22.85 $23.67 $37,000 $37,500 $38,120 33% 15% Variable cost per unit GH $23.87 $39,560 Fixed operating costs except depreciation Accelerated depreciation rate 45% 79 This project will require an investment of $15,000 in new equipment. The equipment will have no salvage value at the end of the project's four-year life. McFann pays a constant tax rate of 40%, and it has a weighted average cost of capital (WACC) of 11%, Determine what the project's not present value (NPV) would be when using accelerated depreciation. ry Determine what the project's net present value (NPV) would be when using accelerated depreciation. (Note: Round your intermediate calculations to the nearest whole number.) O $43.099 11:39 PM X A-Z Determine what the project's net present value (NPV) would be when using accelerated depreciation. (Note: Round your intermediate calculations to the nearest whole number.) $43,099 $38,789 O $51,719 O $34,479 Now determine what the project's NPV would be when using straight-line depreciation. Using the depreciation method will result in the highest NPV for the project. No other firm would take on this project if McFann turns it down. How much should McFann reduce the NPV of this project if it discovered that this project would reduce one of its division's net after-tax cash flows by $700 for each year of the four-year project? $1,303 O $2,389