Question: How do you solve question d? The Campbell Company is considering adding a robotic paint sprayer to its production line. The sprayer's base price is

How do you solve question d? The Campbell Company is considering addingHow do you solve question d?

The Campbell Company is considering adding a robotic paint sprayer to its production line. The sprayer's base price is $810,000, and it would cost another $19,000 to install it. The machine falls into the MACRS 3-year class, and it would be sold after 3 years for $545,000. The MACRS rates for the first three years are 0.3333, 0.4445, and 0.1481. The machine would require an increase in net working capital inventory) of $12,500. The sprayer would not change revenues, but it is expected to save the firm $369,000 per year in before-tax operating costs, mainly labor. Campbell's marginal tax rate is 25%. (Ignore the half-year convention for the straight- line method.) Cash outflows, if any, should be indicated by a minus sign. Do not round intermediate calculations. Round your answers to the nearest dollar. a. What is the Year-O net cash flow? -841500 b. What are the net operating cash flows in Years 1, 2, and 3? Year 1:$ Year 2:$ Year 3: $ 428852 451898 390469 c. What is the additional Year-3 cash flow (i.e, the after-tax salvage and the return of working capital)? $ 436607 d. If the project's cost of capital is 15%, what is the NPV of the project? $ Should the machine be purchased? -Select

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