Kent & Tartt, Inc. is considering replacing a piece of old machinery. The machine has a book value of $50,000 and a remaining useful life of 3 years and no salvage value.

A new, more efficient machine is available at a cost of $200,000 that will have a 3-year useful life with no salvage value. The new machine will lower annual variable production costs from $500,000 to $425,000 for each of the next three years.

What will the net savings be over the next three years if Kent & Tartt buys the new machinery?