Cullumber Inc. manufactures snowsuits. Cullumber is considering purchasing a new sewing machine at a cost of $2.45 million. Its existing machine was purchased 5 years ago at a price of $1.8 million; six months ago, Cullumber spent $55,000 to keep it operational. The existing sewing machine can be sold today for $242,825. The new sewing machine would require a one-time, $85,000 training cost. Operating costs would decrease by the following amounts for years 1 to 7: Year 1 $389,400 2 399.000 3 410.800 4 425.200 5 433,400 6 434 500 7 437.600 The new sewing machine would be depreciated according to the declining-balance method at a rate of 20%. The salvage value is expected to be $379,600. This new equipment would require maintenance costs of $95,600 at the end of the fifth year. The cost of capital is 9%.