2.The ABC company plans to purchase a machine that costs $400,000 and needed for two years. The company has to borrow $200,000 which is repaid in two years at i-1 depreciation purposes, the DB method with a multiplier of 1.5 is applied. Use the PW criterion and the following tables to determine if this was a good investment at MARR of 14%. Assume the company's income tax rate is25% 0%For SOLUTION 227 ..10 points) INCOME STATEMENT End of Year: Revenue: Expenses 500,000 500,000 Operating Costs Depreciation: Debt Interest 40,000 40,000 Taxable Income: Tax: (22%) Net Income: CASH FLOW STATEMENT 0 End of Year Operating Activities: 2 Net Income Depreciation Investment Activities 400,000 Machine Salvage Value 25,000 00.000 Gains Tax Financing Activities: 200,000 Borrowed Money Principal Repayment: Net Cash Flow: PW= Decision: GOOD INVESTMENT BAD INVESTMENT