Help me study for my Accounting class. I’m stuck and don’t understand.

Primary Task Response: Within the Discussion Board area, write 350–450 words that respond to the following questions with your thoughts, ideas, and comments. This will be the foundation for future discussions by your classmates. Be substantive and clear, and use examples to reinforce your ideas.

Additional Information: Eddison Electric Company (EEC) provides electricity for several states in the United States. You have been employed as a cost accountant at this organization. The President of EEC recently called a meeting to announce that a firm has approached EEC about a possible acquisition. The President wants to consider this purchase and has requested that you and your staff analyze the feasibility of acquiring this supplier. Discuss the following:

• Which costs would be utilized in making the decision to purchase the asset? Are future costs relevant in the decision-making process? Please justify and support your position.
• List and discuss the pros and/or cons associated with this potential acquisition.

Another one of your responsibilities as CFO is to determine the suitability of new and current products. Your CEO has asked you to evaluate Android01. That task will require you to combine data from your production analysis from Project 2 with data from a consultant’s study that was done last year. Information provided by the consultant is as follows:

• initial investment: $120 million composed of $50 million for the plant and $70 million net working capital (NWC)
• yearly expenses from year 1 to year 3: $30 million
• yearly revenues from year 1 to year 3: $0
• yearly expenses from year 4 to year 10: $55 million
• yearly expected revenues from year 4 to year 10: $95 million
• yearly expenses from year 11 to year 15: $60 million
• yearly expected revenues from year 11 to year 15: $105 million
• Revenues will vary between $80 million (minimum) and $105 million (maximum) for years 4 to 10, and between $90 million (minimum) and $110 million (maximum) for years 11 to 15.

This concludes the information provided by the consultant.

You also have the following information:

• The asset beta of the project is 1.5. The expected return to the market is 8 percent, and the market risk premium is 5 percent.
• Assume that both expenses and revenues for a year occur at the end of the year. NWC pays the bills during the year, but has to be replenished at the end of the year.
• Android01 is expected to cannibalize the sales of Processor01 while also reducing the variable costs for the production of Processor01. From years 4 to 10, revenues are expected to fall by $5M, whereas variable costs will go down by $1 million. Processor01 is to be phased out at the end of the 10th year.
• At the end of the 15th year, the plant will be scrapped for a salvage value of $10 million. NWC will be recovered.

Question 10: Calculate the expected cash flows from the Android01 project based on the information provided.

Question 11: Calculate the NPV for a required rate of return of 6.5 percent. Also calculate the IRR and the Payback Period.