Maximum Inc, is considered a new six-year expansion project that requires an initial fixed

asset investment of $100,000. The fixed assets will be depreciated using the 5-year

MACRS class. The project is estimated to generate $150,000 in annual sales, with costs

of $80,000. If the tax rate is 35% and the company uses a discount rate of 10%, what is the

present value of cash flows in year 2?