Chicago Saddles, Inc. is considering replacing some capital equipment. The equipment has a three year useful life and the tax authority allows it to be depreciated straight line to zero residual value over three years. The purchase price of the equipment is $240,000 and the company believes the replacement will save it $105,000 in annual pre-tax operating costs, excluding depreciation expenses. Chicago Saddles believes that it can sell the equipment to net $20,000 from a disposal company. The company tax rate is 21% and the cost of capital for investments of this type is 79. What is the annual incremental operating cash flow if the company invests in the replacement equipment? Taking into account the initial investment, any additional terminal flows, and that no incremental working capital will be needed, what is the net present value of the replacement decision? What is the equivalent annual saving? [Label your answers to each of the above questions and present them rounded to the nearest US$. For instance, Equivalent annual savings = $8,763]