Brewer Vending Machine Company plans to replace 10 of its vending machines with newer models. The current machines were purchased three years ago for $8,000 each and are being depreciated straight-line to a salvage value of $2,000 five years from now. The machines collectively generate annual revenue of $30,000 and annual expenses of $12,000. The newer machines can be purchased for $12,000 each and would be depreciated straight-line to a salvage value of $7,000 five years from now. The new machine would generate annual sales of $40,000 because of less downtime than the old machines and the annual expenses of $8,000 (smaller repair bills than the old machines). If Brewer's marginal tax rate is 40%, what will be the incremental change in its annual cash flow if the old machines are replaced? What will be the free cash flow each period from "0" to "5"?

	0	1	2	3	4	5
Revenue
Expenses
Gross Profit
Operating income (EBIT)
Taxes
EBIAT
CapEx
Proceeds from sale of old machine
Change in NWC