Johnson Products is considering purchasing a new milling machine that costs $90,000. The machines installation and shipping costs will total $3,000. If accepted, the milling machine project will require an initial net working capital investment of $30,000. Johnson plans to depreciate the machine on a straight-line basis over a period of 8 years. About a year ago, Johnson paid $6,000 to a consulting firm to conduct a feasibility study of the new milling machine. Johnsons marginal tax rate is 40 percent.

1. Calculate the projects net investment (NINV). Round your answer to the nearest dollar.

   $

2. Calculate the annual straight-line depreciation for the project. Round your answer to the nearest cent.

   $

3. Calculate MACRS depreciation assuming this is a 7-year class asset. Use Table 9A-3 to answer the question. Round your answers to the nearest dollar.

   Year	Depreciation
   1	$
   2	$
   3	$
   4	$
   5	$
   6	$
   7	$
   8	$

ATABLE 9A3 Depreciation Rates for MACRS Property Other than Real Property" Recovery Year 3-Year 5-Year 7-Year 1 33.33% 20.00% 14.29% 44.45 32.00 24.49 14.81 19.20 17.49 7.41 11.52 1249 11.52 8.93 5.76 8.92 8.93 4.46 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 10-Year 10.00% 18.00 14.40 11.52 9.22 7.37 6.55 6.55 6.56 6.55 3.28 * 15-Year 5.00% 9.50 8.55 7.70 6.93 623 5.90 5.90 591 5.90 5.91 5.90 5.91 5.90 5.91 2.95 20-Year 3.750% 7.219 6.677 6177 5713 5.285 4.888 4522 4462 4461 4462 4461 4462 4461 4462 4461 4462 4461 4462 4461 2.231