(ROI and NPV Evaluation) Serendipity is an Internet service provider that has a

(ROI and NPV Evaluation) Serendipity is an Internet service provider that has a major investment in computer and telecom equipment which needs replacement on a regular basis. The company has recently evaluated a $5 million equipment-replacement program which has an expected life of five years. The proposal is supported by the following data:In $thousandsYear 0123456Capital investment$5000Depreciation 20% per year$1000$1000$1000$1000$1000Asset value end of year Profit40003000200010000Additional income15002000250025002500Additional expenses(150)(350)(500)2500(500)Depreciation(1000)(1000)(1000)(1000)(1000)Profit350650100010001000Tax @35%(105)(195)(300)(300)(300)Profit after tax245455700700700ROI6.1%15.2%35.0%70.0%n/aCash flowCapital investment(5000)Cash receipts15002000250025002500Additional expenses(150)(350)(500)(500)(500)Tax @ 35%(105)(195)(300)(300)(300)Net cash flow8(5000)$1350$1545$1805$1700$1700$(300)Discount rate8%Net present value$1225As the ROI and NPV look healthy the investment proposal will be submitted to the board for approval. Prior to the above figures being submitted what comments would you make?