3. Consider the project below and figure the after tax cash flows for each year of the project. Income Statement End of Year Savings Debt Interest Depreciation Taxable Income Income Taxes Net Income Cash Flow Statement Net Income Depreciation Machine Salvage Value Gains Tax Borrowed Funds Principal Repayment Net Cash Flow 0 -300,000 200,000 1 140,000 12,000 60,000 68,000 20,400 47,600 2 140,000 8,231 -62,822 3 4 140,000 140,000 4,235 0 96,000 57,600 17,280 35,769 78,165 10,731 23,449 25,039 54,715 47,600 25,039 54,715 60,000 96,000 57,600 100,000