A business is planning to purchase new equipment at a cost of £60,000. The equipment is expected to last 4 years and to have no scrap value (residual value). Depreciation is calculated on a...

A business is planning to purchase new equipment at a cost of £60,000. The equipment is expected to last 4 years and to have no scrap value (residual value). Depreciation is calculated on a straight-line basis. The investment is expected to generate the following profits/(losses):

Year                      1               2              3               4

Profit/(loss)     (10,000)     20,000     40,000      20,000

Required:

Convert these profits/(losses) to cash flows.