Intro 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 $390,000 to purchase and $20.000 for shipping and installation Last year, the firm cleared an unused area in its timber mil to make space for the machine, at a cost of $8.000 . The new cuming machine will allow the company to sell an additional 140,000 pieces of wood per year at a price of $5 per piece. Variable costs, including timber electricity and labor are expected to add up to 60% 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 Year 1 2 4 Depreciation rate 33% 45% 15% 7% The firm has a marginal tax rate (federal and state of 34% Part 1 B Allempl 1/5 for 10 pes What is the innat (year-o) free cash now trom the project? Choose the right sign Dudecals Submit Attempt 1/5 for 10 pts Part 2 What is the tree cash flow in year 1 3. decimals Subm Part 3 UB Attempt 16 for 10 pts What is the free cash now in year 29 0 decimas Submit o O C 99+ IB Attempt 1/5 for 10 pts Part 2 What is the free cash flow in year 1? 0+ decimals Submit JO Attempt 1/5 for 10 pts. Part 3 What is the free cash flow in year 2? 0+ decimals Submit BB Attempt 1/5 for 10 pts Part 4 What is the free cash flow in year 3? 0+ decimats Submit