Michael's Magnificent Machines, Inc. (MMM). is considering the purchase of a new computerized tool and dye machine (a machine that makes machine parts). The new machine would be an expansion project (it would not replace any current machine) and it would cost $176,000. It has an estimated useful life of 3 years, and would be depreciated on a straight-line schedule. At the end of its useful life it will be sold for $50,000 salvage value. The machine would produce a net operating income (revenue minus expenses), not including taxes or depreciation, of $75,000 per year for its useful life. There is a one time installation cost of $3000 that must be borne when the machine is purchased and a one-time operator-training cost of $10,000 that is immediately expensed. The firm's cost of capital (Kc) is 15%, and (being a Nebraska company with high tax rates) its marginal tax rate is 40% on ordinary income and 20% on capital gains. There are no working capital effects from the project. Given the following information, calculate the NPV of the proposed purchase as an expansion project: Price Tag: $176,000 Installation Cost: $3,000.00 Training Cost: $10,000 (expensed) Estimated useful life: 3 years. Depreciable life: 3 years. Net operating income (revenue minus expenses) before taxes and depreciation: $75,000. (Per year of the machine's operation; revenue ends when the useful life of the machine is over). Depreciation has not yet been deducted from gross revenues to calculate earnings before taxes. Method of depreciation: Straight line. $0 expected salvage value. $50,000 market salvage value. Tax rate: 40% (for ordinary income) 20% (for capital gains). Cost of capital: 15%.