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One year ago, your company purchased a machine used in manufacturing for $95,000. You have learned that a new machine is available that offers many

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One year ago, your company purchased a machine used in manufacturing for $95,000. You have learned that a new machine is available that offers many advantages; you can purchase it for $140,000 today It will be depreciated on a straight-line basis over ten years, after which it has no salvage value. You expect that the new machine will contribute EBITDA (earnings before interest, taxes, depreciation, and amortization) of $35,000 per year for the next ten years. The current machine is expected to produce EBITDA of $24,000 per yoar. The current machine is being depreciated on a straight-line basis over a useful life of 11 years, after which it will have no salvage value, so depreciation expense for the current machine is $8,636 per year All other expenses of the two machines are identical. The market value today of the current machine is $60,000. Your company's tax rate is 40%, and the opportunity cost of capital for this type of equipment is 11%. Is it profitable to replace the year-old machine? The NPV of the replacement is s (Round to the nearest dollar) Should your company replace its year-old machine? (Select the best choice below.) OA. No, there is a loss from replacing the machine OB. Yes, there is a profit from replacing the machine

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