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 and

that you can purchase it for $$140,000$ today. The CCA rate applicable to both machines is $30\%$; neither machine will have any long$-$term salvage value. You expect that the

new machine will produce earnings before interest, taxes, depreciation, and amortization $($EBITDA$)$ of $$35,000$ per year for the next $10$ years. The current machine is

expected to produce EBITDA of $$25,000$ per year. All other expenses of the two machines are identical. The market value today of the current machine is $$50,000.$

Your company's tax rate is $38\%,$ and the opportunity cost of capital for this type of equipment is $12\%.$ Should your company replace its year$-$old machine?