Give a correct title to each column, and under each column explain what it represents or what formula was used to calculate the numbers that you show. You may handwrite these notes onto the paper after printing, if you wish to do that, and add any extra explanations to help the grader follow your solution. Anytime you use MS Excel to solve problems you need to provide the spreadsheet file itself, not just a PDF file.

5. If you buy an IBM server for $85,000 then you can safely plan on being able to use it for 5 years before it needs to be replaced. However, IBM is willing to buy back their server at the end of any year: they will pay $68,000 at the end of the first year, $51,000 at the end of the second year, $30,000 at the end of the third year, $20,000 at the end of the fourth year, and $10,000 at the end of the fifth year. A server from Dell, by contrast, costs $60,000 to purchase, and will only be expected to be usable for 3 years before it needs replacement, with no salvage value. Both servers have the same specifications and capabilities, aside from the number of years of their useful life. Use the Early Termination approach to compare the two alternatives, and identify which has the lowest Present Value, for an interest rate of 11.5%.