Compute the initial outlay for the following project. The cash paid for new capital assets (I₀) is $80,000. The increase in net working capital (W) is $10,000. The cash received on sale of old equipment (S) is $30,000. The book value of the old equipment is $20,000. The tax rate (T) is 0.40.

A. net cash outflow of $40,000

B. net cash outflow of $64,000

C. none of these

D. net cash outflow of $88,000

(on my first attempt I computed cash outflow of $44,000 so I selected C. as the answer, however this was incorrect? Should it be outflow of $40,000?)