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Firm E must choose between two business opportunities. Opportunity $1$ will generate an $$11,520$ deductible loss in year Complete this question by entering your answers in the tabs below.

Which opportunity should Firm E choose?

Firm E should

choose Complete this question by entering your answers in the tabs below.

Req A$2$

Req B$1$

Req B$2$

Req C$2$

Complete the tables below to calculate NPV$.$ Assume Firm E$\text{'}$s marginal tax rate over the three$-$year period is $15$ percent.

Note: Cash outflows should be indicated by a minus sign. Round discount factor$($s$)$ to $3$ decimal places, all other intermediate calculations and final answers to the nearest whole dollar amount.

Show less $A$

$\backslash$table$[[,$Year $0,$Year $1,$Year $2],[$Opportunity $1$:$,,,],[$Before$-$tax cash flow,,,$],[$Tax $($cost$)$ or savings,,,$],[$Net cash flow,,,$],[$Discount factor $(5\%),,,],[$Present value,,,$],[$NPV$,,,],[$Opportunity $2$:$,,,],[$Before$-$tax cash flow,,,$],[$Tax cost$,,,],[$Net cash flow,,,$],[$Discount factor $(5\%),,,],[$Present value,,,$],[$NPV$,,,]]$ Complete this question by entering your answers in the tabs below.

Req A$2$

Req B$1$

Req B$2$

Req C$1$

Req C$2$

Which opportunity should Firm E choose?

Firm E should

chooseComplete this question by entering your answers in the tabs below.

Req B$2$

Req C$1$

Req C$2$

Complete the tables below to calculate NPV$.$ Assume Firm E$\text{'}$s marginal tax rate is $40$ percent in year $0$ but only $15$ percent in years $1$ and $2.$

Note: Cash outflows should be indicated by a minus sign. Round discount factor$($s$)$ to $3$ decimal places, all other intermediate calculations and final answers to the nearest whole dollar amount.

Show less $4$

$\backslash$table$[[,$Year $0,$Year $1,$Year $2],[$Opportunity $1$:$,,,],[$Before$-$tax cash flow,,,$],[$Tax $($cost$)$ or savings,,,$],[$Net cash flow,,,$],[$Discount factor $(5\%),,,],[$Present value,,,$],[$NPV$,,,],[$Opportunity $2$:$,,,],[$Before$-$tax cash flow,,,$],[$Tax cost$,,,],[$Net cash flow,,,$],[$Discount factor $(5\%),,,],[$Present value,,,$],[$NPV$,,,]]$

$0,$$$7,200$ taxable income in year $1,$ and $$28,800$ taxable income in year $2.$ Opportunity $2$ will generate $$8,200$ taxable

income in year $0$ and $$7,200$ taxable income in years $1$ and $2.$ The income and loss reflect before$-$tax cash inflow and

outflow. Firm E uses a $5$ percent discount rate and has a $40$ percent marginal tax rate over the three$-$year period. Use

Appendix A and Appendix B$.$

Required:

a$1.$ Complete the tables below to calculate NPV$.$

a$2.$ Which opportunity should Firm E choose?

b$1.$ Complete the tables below to calculate NPV$.$ Assume Firm E$\text{'}$s marginal tax rate over the three$-$year period is $15$

percent.

b$2.$ Which opportunity should Firm E choose?

c$1.$ Complete the tables below to calculate NPV$.$ Assume Firm E$\text{'}$s marginal tax rate is $40$ percent in year $0$ but only $15$

percent in years $1$ and $2.$

c$2.$ Which opportunity should Firm E choose?

Complete this question by entering your answers in the tabs below.

Req C$2$

Complete the tables below to calculate NPV$.$

Note: Cash outflows should be indicated by a minus sign. Round discount factor$($s$)$ to $3$

decimal places, all other intermediate calculations and final answers to the nearest whole

dollar amount.

Show less $4$

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