please help me understand this problem Answer each question as detailed as possible. 1) Abe Simpson’s Historical Aircraft, Inc. (ASHAI) is considering adding a rare World War II B-24 bomber to its...

please help me understand this problem

Answer each question as detailed as possible.

1) Abe Simpson’s Historical Aircraft, Inc. (ASHAI) is considering adding a rare World War II B-24 bomber to its collection of vintage aircraft.  The plane was forced down in Burma 1942, and it has remained there ever since.  Flying a crew to Burma and collecting the wreckage will cost $100,000.  Transporting the parts to the company’s restoration facility in Springfield will cost another $35,000.  Restoring the plane to flyable condition will cost an additional $600,000 at t₀.

ASHAI’s operating costs will increase by $40,000 a year at the end of years 1 through 7.  At the end of years 3 through 7, revenues from exhibiting the plane at airshows will be $70,000.  At the end of year 7, the plane will be retired.  At that time the plane will be sold to a museum for $500,000.

The plane falls into the 7 year MACRS depreciation schedule.  ASHAI’s tax rate is 35% and the company’s required return on the project is 12%.  Calculate the NPV and IRR of the proposed investment in the plane.