Due to high demand for wood, San Lorenzo Lumber is considering buying a new timber cutting machine to add to its existing stock. - The machine will cost $300,000 to purchase and $20,000 for shipping and installation. Last year, the firm cleared an unused area in its timber mill to make space for the machine, at a cost of $8,000. - The new cutting machine will allow the company to sell an additional 140,000 pieces of wood per year, at a price of $2 per piece. Variable costs, including timber, electricity and labor, are expected to add up to 70% of sales. - To make best use of the new machine, the company will need to increase its inventory of timber logs by $25,000. Since the firm uses trade credit when purchasing raw timber, accounts payable will increase by $12,000. - The cutting machine is expected to last 4 years and will then be sold for $35,000. It falls into the 3-year MACRS class, with depreciation rates as follows: The firm has a marginal tax rate (federal and state) of 34%. Part 1 Attempt 1/5 for 10 pts. What is the initial (year-0) project cash flow? Choose the right sign. What is the project cash flow in year 1 ? Part 3 What is the project cash flow in year 2 ? Part 4 What is the project cash flow in year 3