One year ago, your company purchased a machine used in manufacturing for $$90,000.$ You have learned that

a new machine is available that offers many advantages and you can purchase it for $$150,000$ today. It will be

depreciated on a straight$-$line basis over $10$ years and has no salvage value. You expect that the new

machine will produce a gross margin $($revenues minus operating expenses other than depreciation$)$ of

$$40,000$ per year for the next $10$ years. The current machine is expected to produce a gross margin of

$$20,000$ per year. The current machine is being depreciated on a straight$-$line basis over a useful life of

$11$ years, and has no salvage value, so depreciation expense for the current machine is $$8,182$ per year. The

market value today of the current machine is $$45,000.$ Your company's tax rate is $38\%,$ and the opportunity

cost of capital for this type of equipment is $11\%.$ Should your company replace its year$-$old machine?