PLEASE ANSWER BOTH QUESTIONS AND CLEARLY INDICATE THE ANSWERS

8. (30pts) What is the ATCF rate of return for machine that costs 160,000, sold in year 5 with a salvage value 20,000, and is classified as 7 year MACRS property? The machine will be purchased with a 25.0% down payment and a three year loan for the remaining amount at an annual interest rate of 9.50%. The machine produces net revenues after deducting direct and indirect expenses but not depreciation of 46,000 in year 1, 95,000 in years 2 to 4, and 10,000 in year 5. Use a tax rate of 21.00%. 9. (30pts) What is the ATCF rate of return for machine that costs 300,000, lasts for 8 years, has zero salvage value, and is classified as 5 year MACRS property? The machine will be purchased with zero down payment and a five year loan for the remaining amount at an annual interest rate of 11.50%. The operation of the machine also requires a working capital of 80,000. The machine produces net revenues after deducting direct and indirect expenses but not depreciation of 46,000 in year 1, 120,000 in years 2 to 6, 60,000 in year 7, and 40,000 in year 8. Use a tax rate of 21.00%