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Caleulate ONL Y the initial and terminal cash flows. For the toolbar oress ALT+F10 PPC or ALT+FN+F10 (Mac) The company is considering replacing an older

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Caleulate ONL Y the initial and terminal cash flows. For the toolbar oress ALT+F10 PPC or ALT+FN+F10 (Mac) The company is considering replacing an older manual priatins press with a newer, compoterized one. The old andlibe was purchased 10 yeur ago and had a lotal useful life of fifterl year. It originally coct 5150,000 and was being depreciated by the simplified straight-line method at a rate of $10,000 per year, Since the old machine uses soch outmoded technology, it can be sold today for only 535,000 . The old machine required two opentors who euch eumed 525,000 per yeur (salary expense). The old machine required 57,500 in maintenance: expense ench yeat. It produced a total of 510,000 per year of defective texthooks that could not be sold (defective product expense) The new machine being considered will cos $195,000 and will require $1,000 staipping and $900 instaltution fees. In addition, Dasti Corp. amticipates spending $3500 to nodify the new nachine for their special condations. The new machine has a 5 -year aseful life and will be depreciated using MACRS with i 5-year invesiment chass. At the end of five years of use, the new machine bs expected to be sold for 565,000 . The new machine requires only one operator who will eam 535,000 per year (salary expense). The new machine will requife 57,500 in maintenance expense each year. The new machise will produce $12,000 per year of defective textbooks (defective product expense. Since the new machne will opeate so mach fater than the old one, an additional $12,000 wat be invested in itventory (net working capital). Also, an increase in sties revenue of 527,500 per year is expected

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