Question: MUST USE EXCEL! Tom is evaluating a project that costs $2,400,000, has a four-year life, and has no salvage value. Assume that depreciation is straight-line

MUST USE EXCEL!

Tom is evaluating a project that costs $2,400,000, has a four-year life, and has no salvage value. Assume that depreciation is straight-line to zero over the life of the project. Sales are projected at 100,000 units per year, price per unit is $45, variable cost per unit is $20, and fixed costs are $1.5 million per year. The tax rate is 21%, and the required rate of return on the project is 9%.

1a. Calculate the NPV for the project. (Round to 2 decimals)

1b. Calculate the accounting break-even number of units for the project. (Round to 2 decimals)

1c. Calculate the equivalent annual cost of the machine. (Round to 2 decimals)

1d. Calculate the financial breakeven number of units for the project. (Round to 2 decimals)

1e. Suppose the price, units, VC per unit, and FC projections are accurate within +/- 10%. Calculate the best case NPV. (Round 2 decimals)

1f. Suppose the price, units, VC per unit, and FC projections are accurate within +/- 10%. Calculate the best case NPV. (Round 2 decimals)

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