At times firms will need to decide if they want to continue to use their current equipment or replace the equipment with

[answerhappygod]

At times firms will need to decide if they want to continue to
use their current equipment or replace the equipment with newer
equipment. In this case, the company will need to perform a
replacement analysis to determine which alternative is the
best financial decision for the company.
Consider the case of LoRusso Company:
The managers of LoRusso Company are considering replacing an
existing piece of equipment, and have collected the following
information:
Complete the following table and compute the incremental cash
flows associated with the replacement of the old equipment with the
new equipment.
Year 0
Year 1
Year 2
Year 3
Year 4
Year 5
The net present value (NPV) of this replacement project is
($936,429/ $1,498,286/ $1,248,572/ $1,435,858)
.