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Replacement Analysis Kenley Corp is looking to replace some of their old equipment. Old Equipment can last 6 more years: Depreciation expense, Years 1 to 5 $550 $325 Depreciation expense, Year 6 Current book value $3,575 Current market value $4,150 Market value, Year 6 $800 New Equipment: Estimated useful life (in years) 6 Purchase price $13,000 Sell for Year 6 $1,300 Working Capital Needs (Add to cost of $1,500 the project and needs to be added back on in year 6) Annual Savings $3,000 Tax rate 25.00% WACC 14.00% MACRS Year 1 20.00% Year 2 32.00% Year 3 19.20% Year 4 11.52% Year 5 11.52% Year 6 5.76% Find the NPV, PI, Payback, Discounted Payback and IRR