Video Excel Online Structured Activity: Replacement Analysis A 2 The Gilbert Instrument Corporation is considering replacing the wood steamer it currently uses to shape guitar sides. The stuamer has 6 years of remaining life. I kept, the steamer will have depreciation expenses of $650 for 5 years and $325 for the sixth year. Its current book value is $3,575, and it can be sold on an Internet auction site for $4,150 at this time. If the old steamer is not replaced, it can be sold for $800 at the end of its useful life. Gilbert is considering purchasing the Side Steamer 3000, a higher-end steamer, which costs $14,000, and has an estimated useful life of 6 years with an estimated salvage value of $1,400. This steamer falls into the MACRS 5-years class, so the applicable depreciation rates are 20.00%, 32.00%, 19.20%, 11.52%, 11.52%, and 5.76%. The new steamer is faster and would allow for an output expension, so sales would rise by $2,000 per year; even so, the new machine's much greater efficiency would reduce operating expenses by $1,600 per year. To support the greater sales, the new machine would require that inventories increase by $2,900, but accounts payable would simultaneously increase by $700. Gilbert's marginal federal-plus-state tax rate is 40%, and its WACC is 16% The data has been collected in the Microsoft Excel Online file below. Open the spreadsheet and perform the required analysis to answer the questions below. . Open spreadsheet uy $2,00, but accounts payable would simultaneously Inc $700. Gilbert's marginal federal-plus-state tax rate is 10%, and its WACC is 16%. The data has been collected in the Microsoft Excel Online file below. Open the spreadsheet and perform the required analysis to answer questions below. X Open spreadsheet Should it replace the old steamer? The old steamer be replaced. What is the NPV of the project? Do not round intermediate calculations, Round your answer to the nearest dollar. $ Check My Work Reset Problem B D E G H 6 Now Equipment Estimated useful life (in year) Purchase price Salvape valon, Year 6 Annual sales increase Annual reduction in operating expenses Initial incase in inventarios Initiat increase in accounts payable $14,000 $0 $2,000 $1,600 $2,900 $700 Year 2 Year 1 20.00% Year 3 19 20% Year 4 11.52% Year 11.52% Yoar 6 5.76 MACRS depreciation rates (5-year class 32 0096 Tax rate WACC 40.00% 16.00% Formulas Step 1: Calculation of investment at 10 Purchase price of new equipment Sale of old equipment Tax on sale of old equipment SO $4,150 ANIA