Net Present Value

For discount factors use Exhibit $12$B$-1$ and Exhibit $12$B$-2.$

Talmage Inc. has just completed development of a new printer. The new product is expected to produce annual revenues of $$2,700,000.$ Producing the printer requires an investment in new equipment costing $$2,880,000.$ The printer has a projected life cycle of $5$ years. After $5$ years, the equipment can be sold for $$360,000.$ Working capital $$1,620,000.$ The required rate of return is $8\%.$

Required:

Prepare a schedule of the projected annual cash flows.