Your company has been doing$$ well, reaching $ $1\mathrm{.}02$ million in$$ earnings, and is considering launching a new product. Designing the new product has already cost $ $535$ comma $000.$ The company estimates that it will sell $802$ comma $000$ units per year for $ $3\mathrm{.}07$ per unit and variable$$ non$-$labor costs will be $ $1\mathrm{.}12$ per unit. Production will end after year $3.$ New equipment costing $ $1\mathrm{.}14$ million will be required. The equipment will be depreciated to zero using the$7-$year MACRS schedule. You plan to sell the equipment for book value at the end of year $3.$ Your current level of working capital is $ $293$ comma $000.$ The new product will require the working capital to increase to a level of $ $376$ comma $000$immediately$,$ then to $ $397$ comma $000$ in year$1,$ in year $2$ the level will be $ $343$ comma $000,$ and finally in year $3$ the level will return to $ $293$ comma $000.$ Your tax rate is $21\%.$ The discount rate for this project is $10\mathrm{.}1\%.$ Do the capital budgeting analysis for this project and calculate its NPV$.$

Note$$: Assume that the equipment is put into use in year $1.$ Design already happened and is

$$

variable

fixed

sunk

$($irrelevant$).($Select from the$$ drop$-$down menu.$)$

Part $2$

According to the$7-$year MACRS$$ schedule, depreciation in year $1$ will be $$$

$$

enter your response here. $($Round to the nearest$$ dollar.$)$

Part $3$

Depreciation in year $2$ will be $$$

$$

enter your response here. $($Round to the nearest$$ dollar.$)$

Part $4$

Depreciation in year $3$ will be $$$

$$

enter your response here. $($Round to the nearest$$ dollar.$)$

Part $5$Complete the capital budgeting analysis for this project below: $($Round to the nearest dollar.$)$