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 \$460,000 to purchase and \$20,000 for shipping and installation. Last yoa, the frm cleared an unved ares in its timber mill to make spece for the machine, at a cost of $8,000. - The new cutting machine will allow the compary to sell an additional 140,000 pieses of wood per year, at a price of $4 per pioce. Variable costs, including fimbec electricity and laboc, are expected to add up to 70% of sales. - To make beat use of the new machine, the company will need to increase its iventory of timber logs by $25,000. Since the fim uses trado crodit when purchasing raw timbec, accounts payable will increase by $12,000. - The culting machine is expected to last 4 yoars and will then be sold for $35,000. it falls into the 3-year MACRS class, with deprociation rates as follows: The tim has a marginal tax rate federal and state) of 34%. Part 1 B Attempt 1/5 for 10pts. What in the initial fyear-0) bee cain fow trom the project? Choose the ngit sign. Part 2 What s the free cash fow in yes 17 EI E Atterngt 1/5 for 10 pts What is the initial (year-0) free cash flow from the project? Choose the right sign. What is the free cash flow in year 1? Part 3 - - Atternpt 1/5 for 10pts. What is the free cash fow in year 2? Part 4 E E m Attempt 1/5 for 10 pts. What is the free cash flow in year 3