ABC is considering the purchase of a new machine for a four-year expansion project. The machine will cost $60,000 plus $18,000 for shipping and handling. Using the straight-line depreciation method, the machine will be depreciated to zero book value over a 4-year period. ABC forecasts that revenues will increase by $125,000 and operating expenses will increase by $100,000 for each of the next four years and will then be sold for $15,000 at end of the year four when the project ends. The new machine would require that inventories increase by 5,000, but A/P would simultaneously increase by $300. ABC's tax rate is 25% and its rate of return is 8.0%. What is the amount of total cash flow in year 4?

None of the above $39,575 $36,750 $43,255 $41,875