Please answer the questions from the first image, by using the estimates in the second image. I need to check my work. Thank you!

Ma&P2 Project Proposal Worksheet Use the cipht year model, along with Andre's estimates for questions a thrue a. At the end of the project, what is Ma \& Pa Incorporated 's camings before twexes then? At the current tax rate for Ma \& Pa incorporated, what is Ma \& Pa Incorporated's net income? b. Compute the project's after-tax cash flow. Operating cash flow = (Sales-Costs - Depreciation) (1f)+ Depreciation change in net working capital c. Compute and interpret the project's NPV, IRR, and profitability index. d. According to your above calculations: What is your interpretation on if the project should be accepted or rejected? c. The minimum required rate of return is a weighted average of the firm's costs of various sources of capital. Explain. f. Ma \& Pa Incorporated realize that the project depreciation needs to be $290,000 and the project needs to last 10 years. The depreciation is now computed as follows: - Land value depreciation. 80,000 - Building value depreciation: 75,000 - Equipment depreciation 70,000 - IT infrastructure deprecianion 65,000 Please compute the new NPV, IRR, and profitability index asing the new numbers. g. Assume that they reduced the expenses, but depreciation increased to 350,000 and the project duration decreased to 6 years - Land ralue depreciatioa: 100,000 - Building valoe depecciation 90,000 - Equipment depreciation: 55,000 - IT infratructure derccciation 75,000 Please compute the new. NPV, 1RR, and peofitability index wing the new numbers. h. Regarding firm's deciuton itrategies Between the original eiaht vear scenania and the scearios from f and g (vix and 10 year ccenarios) - adentify which is the best scratrio. Please justify your choice using IRR. NPV and PI. I. Up-front costs: Andre Russell worked with the top management (Bill, Lucy, Lilian, and Hillary) as well as selected middle manager to arrive at the up-front costs. Based on his discussions with them, he is anticipating the up-front costs to be comprised of the following - Cost of the land: He anticipates that the land will cost about $40,000 per acre and be needs about 5 acres ( $200,000 in total). - Cost of the building: $1,000,000 - Equipment: $250,000 - Fumiture: $200,000 - IT infrastructure: $550,000 - Total projected up-front costs: \$2,200,000 II. Cost of capital- Andre researched extensively on cost of capital and found: - Total projected cost of capital: $195,000 IIL. Sales: After working with Elizabeth Brown, Director of Sales and Marketing and several other managers in her area, Andre is projecting the following sales for the first year. Further, these sales are expected to grow at 10% compounded for the duration of the project. - Electronic toys for children: $175,000 - Halloween toys: $320,000 - Christmas toys: $430,000 - Total projected sales: \$925,000 IV. Cash expenses: Based on the past expenses and projections for future expenses, Andre arrived at the following expenses on an annual basss. For simplicity. Andre assumed that these expenses will grow at 2% annually for the duration of the project. - Labor Employment Expenses: \$\$7,500 - Maintenance: 577,500 - New equipment 575,000 - IT budzes 570,000 - Total projected cash expense: $310,000 V. Depreciation: Andre is expecting that the depreciahoa will computed as follows: - Land value depreciation: $70,000 - Bualding value depreciation: 565,000 - Equipment depreciation 560,000 - Ir infrastructure depreciatioa 555,000 - Total projected depreciation: $250,000 Ma&P2 Project Proposal Worksheet Use the cipht year model, along with Andre's estimates for questions a thrue a. At the end of the project, what is Ma \& Pa Incorporated 's camings before twexes then? At the current tax rate for Ma \& Pa incorporated, what is Ma \& Pa Incorporated's net income? b. Compute the project's after-tax cash flow. Operating cash flow = (Sales-Costs - Depreciation) (1f)+ Depreciation change in net working capital c. Compute and interpret the project's NPV, IRR, and profitability index. d. According to your above calculations: What is your interpretation on if the project should be accepted or rejected? c. The minimum required rate of return is a weighted average of the firm's costs of various sources of capital. Explain. f. Ma \& Pa Incorporated realize that the project depreciation needs to be $290,000 and the project needs to last 10 years. The depreciation is now computed as follows: - Land value depreciation. 80,000 - Building value depreciation: 75,000 - Equipment depreciation 70,000 - IT infrastructure deprecianion 65,000 Please compute the new NPV, IRR, and profitability index asing the new numbers. g. Assume that they reduced the expenses, but depreciation increased to 350,000 and the project duration decreased to 6 years - Land ralue depreciatioa: 100,000 - Building valoe depecciation 90,000 - Equipment depreciation: 55,000 - IT infratructure derccciation 75,000 Please compute the new. NPV, 1RR, and peofitability index wing the new numbers. h. Regarding firm's deciuton itrategies Between the original eiaht vear scenania and the scearios from f and g (vix and 10 year ccenarios) - adentify which is the best scratrio. Please justify your choice using IRR. NPV and PI. I. Up-front costs: Andre Russell worked with the top management (Bill, Lucy, Lilian, and Hillary) as well as selected middle manager to arrive at the up-front costs. Based on his discussions with them, he is anticipating the up-front costs to be comprised of the following - Cost of the land: He anticipates that the land will cost about $40,000 per acre and be needs about 5 acres ( $200,000 in total). - Cost of the building: $1,000,000 - Equipment: $250,000 - Fumiture: $200,000 - IT infrastructure: $550,000 - Total projected up-front costs: \$2,200,000 II. Cost of capital- Andre researched extensively on cost of capital and found: - Total projected cost of capital: $195,000 IIL. Sales: After working with Elizabeth Brown, Director of Sales and Marketing and several other managers in her area, Andre is projecting the following sales for the first year. Further, these sales are expected to grow at 10% compounded for the duration of the project. - Electronic toys for children: $175,000 - Halloween toys: $320,000 - Christmas toys: $430,000 - Total projected sales: \$925,000 IV. Cash expenses: Based on the past expenses and projections for future expenses, Andre arrived at the following expenses on an annual basss. For simplicity. Andre assumed that these expenses will grow at 2% annually for the duration of the project. - Labor Employment Expenses: \$\$7,500 - Maintenance: 577,500 - New equipment 575,000 - IT budzes 570,000 - Total projected cash expense: $310,000 V. Depreciation: Andre is expecting that the depreciahoa will computed as follows: - Land value depreciation: $70,000 - Bualding value depreciation: 565,000 - Equipment depreciation 560,000 - Ir infrastructure depreciatioa 555,000 - Total projected depreciation: $250,000