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Can you help me with this question please Hartseld Company is considering the purchase of a new milling machine during year 0. The machine's base

Can you help me with this question please

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Hartseld Company is considering the purchase of a new milling machine during year 0. The machine's base price is $135,000, and it will cost another $15,000 to modify it for special use. The capital allowance rate is given as 30%. The machine will be sold after three years for $80,000 (actual dollars). Use of the machine will require an increase in net working capital (inventory) of $10,000 at the beginning of the project year. The machine will have no effect on revenues, but it is expected to save the rm $80,000 (today's dollars) per year in before-tax operating costs, mainly for labour. The firm's marginal tax rate is 40%, and this is expected to remain unchanged over the duration of the project. However, the company expects that the labour cost will increase at an annual rate of 5%, but the working-capital requirement will grow at an annual rate of 8%, caused by ination. The selling price of the milling machine is not affected by ination. The general ination rate is estimated to be 6% per year over the project period. The firm's market interest rate is 20%. Using the information above, nd the net cash ow in year 3 (actual dollars)

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