The modern Age Copier Company is considering purchasing a copierfor use by customers. Data for the copier under consideration isreflected in the table below. The copier is expected to last 8years. The tax rate is 30%. The Company will not accept a projectwith a return of less than 12% Copier Equipment Cost $64,000 AnnualRevenues $80,000 Annual Paper Costs $33,100 Annual MaintenanceCosts $20,000 Annual Depreciation $ 8,000 All of the items in thetable above are taxable or tax deductible except for the initialcost of the copier Equipment. Although the initial cost is not taxdeductible, the initial cost will be subject to depreciation.Assume straight line depreciation with no residual value. 1. ShouldModern Age Copier undertake this project? Explain and support withanalysis. 2. Compute the Payback period (Round to one decimalplace) Show analysis.
