12. Mistletoe Co. is evaluating the possible acquisition of a new machine to replace existing machine. The new machine will cost $1,751,000. Freight and installation necessary to put the machine in service will cost $140,000. The firm expects that, due to increased sales, inventory and accounts receivable will increase by $170,000 and S120.000, respectively. Accounts payable are expected to increase by $150,000. The firm thinks that it could sell the existing machine for $180,000. The current book value of the existing machine is $130,000 and the firm's tax rate is 40%. What is the firm's initial outlay for this replacement project? an a. $1,845,000 b. $1,860,300 c. $1,871,000 d. $1,905,000 e. $1,916,300