Q. Artisan Plastic and Processing (APP) wants to expand its operations. It is considering the purchase of pressing machine for its new line of plastic materials worth $800,000. The company estimates that the equipment will enable them to increase revenues by $550,000 per year for the next five years, which is the useful life of the equipment. Additional variable operating expenses related to the project are estimated to be $250,000 per year. The project will also require a fixed expense of $50,000 per year. APP will install the new machine in an existing facility that was acquired two years ago for $550,000. This facility is currently leased out to a third party for a yearly revenue of $30,000. Once the machine is installed there, APP will lose the lease revenue. At the end of its useful life, management believes the pressing equipment can be sold (salvage value) for $20,000. APP will require $25,000 of net working capital for this project which will be recovered at the end of the project. The company uses a discount rate of 10% for projects of similar risk, and their marginal tax rate is 30%. The pressing equipment has a capital cost allowance (CCA) or depreciation rate of 20%. Use the net present value (NPV) method to evaluate the project. Should the company accept or reject the project? You must show your work for full marks.