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6) (35 points) A company is considering purchasing new equipment that is expected to generate an additional income of $75,000 annually. The equipment will have

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6) (35 points) A company is considering purchasing new equipment that is expected to generate an additional income of $75,000 annually. The equipment will have an initial cost of $115,000 and estimated annual operating and maintenance costs of $45,000. Its estimated salvage value at the end of its useful life of 4 years is $22,500. The equipment is a MACRS-GDS 3-year property for calculating depreciation deductions. The effective tax rate is 35%. The after-tax MARR is10% per ycar compounded annually. (25 points) For this new equipment, determine the after-tax cash flow for each year of operation. a) MACRS-GDS Deduction ATCF BTCF able Income 3 b) (10 points) Use present worth analysis to determine if the company should purchase this new equipment. 2200 000 2532000 000 200000 2a0on

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