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(20Marks)Homantin, Inc. is considering a project for opening a newsporting goods store in a suburban mall. Homantin will lease theneeded space in the mall. Equipment and fixtures for the store willcost $600,000. It is the accounting policy of the company todepreciate equipment and fixtures over a 5-year period on astraight-line basis with no residual value. However, the managerexpects equipment and fixtures to be sold at $20,000 at the end of5 years. The new store will require Homantin to increase its networking capital by $200,000 when the project is launched.First-year sales are expected to be $1,000,000 and to increase atan annual rate of 7 percent over the expected 5-year life of thestore. Operating expenses (including lease payments and excludingdepreciation) are projected to be $800,000 during the first yearand increase at a 6 percent annual rate. Homantin’s marginal taxrate is 35 percent and Homantin needs to pay capital gain tax.Assume that the required rate of return for Homantin is 15%.Required:(a)Evaluate the initial outlay of the project.(b)Analyze the annual net cash flows for the first 4 years of theproject. Please show your calculation steps in a table.(c)What is the annual net cash flow at the end of the project?(d)Discuss whether you would accept or reject the project if therequired payback period is 4 years.(e)How about your decision if profitability index and internal rateof return are employed, respectively?(f)What would be your decision if the net present value rule isused?