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Mom's Cookies, Incorporated, is considering the purchase of a new cookie oven. The original cost of the old oven was $ 3 0 , 0
Mom's Cookies, Incorporated, is considering the purchase of a new cookie oven. The original cost of the old oven was $; it is
now five years old, and it has a current market value of $ The old oven is being depreciated over a year life toward a zero
estimated salvage value on a straightline basis, resulting in a current book value of $ and an annual depreciation expense of
$ The old oven can be used for six more years but has no market value after its depreciable life is over. Management is
contemplating the purchase of a new oven whose cost is $ and whose estimated salvage value is zero. Expected beforetax
cash savings from the new oven are $ a year over its full life, you can use bonus depreciation on the oven, and the cost of capital
is percent. Assume a percent tax rate.
What will the cash flows for this project be
Note: Round your answers to the nearest dollar amount.
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