20. The Minot Kit Aircraft Company of Minot, ND uses a plasma cutter to fabricate metal aircraft parts for its plane kits. The company currently is using a cutter that it purchased used 4 years ago which has an $80,000 book value and is being depreciated $20,000 per year over the next 4 years, after which the salvage value will be zero. If the old cutter were to be sold today, the company estimates that it would bring in an amount equal to the book value of the equipment. The company is considering the purchase of a new automated plasma cutter that would cost $400,000 to install and which would be depreciated over the next 4 years toward a $40,000 salvage value using straight-line depreciation. The primary advantage of the new cutter is the fact that it is fully automated and can be run by one operator rather than the three employees that are currently required. The labor savings would be $100,000 per year. The firm faces a marginal tax rate of 30%. (25 marks) a. What are the differential operating cash flow savings per year during year 1 through 4 for the new plasma cutter? (10 marks) b. What is the initial cash outlay required to replace the existing plasma cutter with the newer model? (10 marks) c. If the company requires a 15 percent discount rate for new investments, should the fleet be replaced