Question 9 Network Computers is deciding whether to invest in prevention costs for its servers. Data regarding the decision between investing or not is as follows: 12 Invest in Do Not Invest Prevention Cost of Equipment $ 175.000 $ Working capital investment required $ 25.000 Annual Activity Annual Sales (assume all cash) $ 294.000 $175.000 Annual Cash Expenses Repair Costs $ 14,000 $ 35.000 Depreciation $ 21.875 $ Maintenance $ 30,000 Supplies $ 55,000 Retooling costs of equipment at Year 5 $ 115,000 Salvage value of equipment $ 3,500 Life of project 8 8 The working capital will be released for investment elsewhere at the end of the 8 years. Network Computers uses a 8% discount rate. (Ignore income taxes) Show all computations using the net present value format. Prepare separate computations for each project. a) Invest in Prevention $ $ $ $ b) Do Not Invest