Masters Machine Shop is considering a four-year project to improve its production efficiency. Buying a new machine press for $440,000 is estimated to result in $178,000 in annual pretax cost savings. The press falls in the MACRS five-year class, and it will have a salvage value at the end of the project of $72,000. The press also requires an initial investment in spare parts inventory of $31,000, along with an additional $3,650 in inventory for each succeeding year of the project. The shops tax rate is 21 percent and its discount rate is 12 percent. (MACRS schedule)