Manning Corporation is considering a new project requiring a $100,000 investment in test equipment with no salvage value. The project would produce $67,500 of pretax income before depreciation at the end of each of the next six years. The companys income tax rate is 38%. In compiling its tax return and computing its income tax payments, the company can choose between the two alternative depreciation schedules shown in the table. (FV of $1, PV of $1, FVA of $1 and PVA of $1) (Use MACRS) (Use appropriate factor(s) from the tables provided.)

	Straight-Line Depreciation				MACRS Depreciation
Year 1		$	10,000			$	20,000
Year 2			20,000				32,000
Year 3			20,000				19,200
Year 4			20,000				11,520
Year 5			20,000				11,520
Year 6			10,000				5,760
Totals		$	100,000			$	100,000

Complete the following table assuming use of straight-line depreciation. Net cash flow equals the amount of income before depreciation minus the income taxes. Income Before Straight-Line Taxable Income Net Cash Depreciation Depreciation Income Flows Year 1 Year 2 Year 3 Year 4 Year 5 Year 6