Discuss the below:
Phase: Capital Budgeting Concepts Summary .IP within Intellipath. A company is considering making a new bicycle. The company expects to sell 4,000 units of the bicycle each year for 5 years. Each bicycle is expected to sell for $400. The company's tax rate is 30%. Fixed costs are $700,000 per year, and variable costs are $75 per bicycle. To make the bicycle, the company will purchase a machine that costs $1.5 million today. The machine will be depreciated with straight-line depreciation over a 5-year period. The machine will be sold for $50,000 when this project ends in 5 years. The net working capital requirements are $150,000 at Year 0, which are expected to be recovered in full in Year 5. The required rate of return for the project is 12%. Complete the following: Estimate the project's cash flows for each year for years 0-5. Estimate the project's net present value (NPV) at the end of year
State whether the project should be accepted or not giving a reason. (100-150 words).
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