. Equipment Replacement. By replacing present equipment with more efficient equipment, Willie Company estimates that cash operating costs can be reduced by \(\$ 65,000\) a year. In addition, increased sales volume can result in a larger contribution margin of \(\$ 25,000\) a year without considering the efficiency savings. Depreciation of \(\$ 50,000\) per year will be taken on new equipment. Depreciation on present equipment is \(\$ 10,000\) per year. The income tax rate is 40 percent.

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What is the estimated incremental annual aftertax cash inflow on this investment?