Hercules Exercise Equipment Co. purchased a computerized measuring device two years ago for S52,000. The equipment falls into the five-year category for MACRS depreciation and can currently be sold for $21,800. A new piece of equipment will cost $142,000. It also falls into the five-year category for MACRS depreciation. Assume the new equipment would provide the following stream of added cost savings for the next six years. Use Table 12-12. Use Appendix B for an approximate answer but calculate your final answer using the formula and financial calculator methods. Cash Year Savings 1$59,000 51,000 49,000 4 47,000 44,000 6 33,000 The firm's tax rate is 35 percent and the cost of capital is 9 percent. h. Determine the incremental depreciation between the old and new equipment and the related tax shield benefits. (Enter the tax rate as a decimal rounded to 2 decimal places. Round all other answers to the nearest whole dollar.) Depreciation Depreciation on Old DepreciationTax RateTax Shiel Benefits Year on New Equipment Equipment 6 i. Compute the aftertax benefits of the cost savings. (Enter the aftertax factor as a decimal rounded to 2 decimal places. Round all other answers to the nearest whole dollar.) Aftertax as (1 Tax Rate)Savings Year Savings 1-Tax Rate) $59,000 51,000 49,000 47,000 44000 33000 i-1. Add the depreciation tax shield benefits and the aftertax cost savings to determine the total annual benefits. (Do not round intermediate calculations and round your answers to the nearest whole dollar.) Year Benefits from Aftertax Cost Total Annual SavingsBenefits Depreciation j-2. Compute the present value of the total annual benefits. (Do not round intermediate calculations and round your answer to the nearest whole dollar.) Total annual benefits k-1. Compare the present value of the incremental benefits to the net cost of the new equipment (e), (Do not round intermediate calculations. Negative amount should be indicated by a minus sign. Round your answer to the nearest whole dollar.) Total annual benefits k-2. Should the replacement be undertaken? Yes No