prepare a pro forma statement showing the annual cash flows resulting from the

Lawn Robot project, and compute the NPV and IRR of the project.

In addition to this base case, also consider the following two scenarios: (i) Sales forecasts are

10% worse (pessimistic) and (ii) sales forecasts are 10% better (

optimistic). (Note that you need to compute cash flows as well as the NPV and IRR for each of these

scenarios.)

Estimating Cash Flow?New Project Analysis the Lawn Robot

Is It Really Worth It?

Table 1 Table 2 Modified ACRS Depreciation Allowances Year 5 -year year 1 14-29% 2 24-49% _17-49% 412-49% 5 8.93% 6 8.93% 8.93% 8 4.45% Note Term of project Initial Cost of equipment After 10 years equipment worth Leasing building cost Fixed cost Variable cost Initial additional cost Account payable increase by Account receivable Net working Capital WACC Interest expense Tax rate