Javier has asked corporate controller Carolina Mendoza to gather information about the costs and benefits of implementing CIM. Carolina has gathered the following data:

Initial equipment cost $$6,000000$

Working capital required at start up $$500,000$

Salvage value of existing equipment $$75,000$

Annual operating cost savings $$900,000$

Salvage value of new equipment $$100,000$

Working capital released $$500,000$

Useful life of equipment $10$ years