Ch 13: End-of-Chapter Problems - Capital Budgeting: Estimating Cash eBook Replacement Analysis The Everly Equipment Company's flange-tipping machine was purchased 5 years ago for $40,000. It had an expected We of 10 years when it was bought and its remaining depreciation is $4,000 per year for each year of its remaining life. As older Mange-ippers are robust and useful machines, this one can be sold for $20,000 at the end of as we life A new high-efficiency digital-controlled Mange-lipper can be purchased for $180,000, including installation costs. During its spear life. It will reduce cathcorating expenses by $40,000 per year, although it will not affect sales. At the end of its useful life, the high-efficiency machine is estimated to be worthless, MACRS depreciation will be used, and the machine will be depreciated over its 3-year class life rather than its 5-year economic life, so the applicable depreciation rates are 33.33, 44.45, 14.81%, and 7411 The old machine can be sold today for $45,000. The firm's tax rate is 35%, and the appropriate cost of capital is 10% a. If the new flange-lipper is purchased, what is the amount of the initial cash now at Year o? Round your answer to the ntarest detar. Cash outfow, if any, should be indicated by a minus sign $ b. What are the incremental net cash flows that will occur at the end of Years 1 through s? Do not round intermediate calculations. Round your answers to the nearest dollar. Cash outflows, if any, should be indicated by a minus sign. CF $ CF $ CF 5 CF $ CFS 5 c. What is the NPV of this project? Do not round intermediate calculations. Round your answer to the nearest whole dollar. Negative value, if any, should be indicated by a minus sign $ Should Everly replace the flange-lipper? -5 elect