Please help with questions A-C

P11-16 (similar to) Question Help O Relevant cash flowsNo terminal value Central Laundry and Cleaners is considering replacing an existing piece of machinery with a more sophisticated machine. The old machine was purchased 3 years ago at a cost of $46,600, and this amount was being depreciated under MACRS using a 5-year recovery period. The machine has 5 years of usable life remaining. The new machine that is being considered costs S75,300 and requires $4,400 in installation costs. The new machine would be depreciated under MACRS using a 5-year recovery period. The firm can currently sell the old machine for $55,000 without incurring any removal or cleanup costs. The firm is subject to a tax rate of 40%. The revenues and expenses (excluding depreciation and interest) associated with the new and the old machines for the next 5 years are given in the table - Table contains the applicable MACRS depreciation percentages.) Note: The new machine will have no terminal value at the end of 5 years. a. Calculate the initial investment associated with replacement of the old machine by the new one. b. Determine the incremental operating cash inflows associated with the proposed replacement. (Note: Be sure to consider the depreciation in year 6.) c. Depict on a timeline the relevant cash flows found in parts (a) and (b) associated with the proposed replacement decision. 16,5941 Tax on sale of old asset Total proceeds, sale of old asset (38,406) 41.294 Initial investment b. Determine the incremortal operating cash inflows associated with the proposed replacement. (Note: Be sure to consider the depreciation in year 8.) Calculate the cash flows with the old machine below: (Round to the nearest dollar.) Year 1 Profit before depreciation and taxes Depreciation $ $ $ Net profit before taxes Taxes $ Net profit after taxes $ Operating cash inflows $ Enter any number in the edit fields and then click Check Answer. ? Salto) Data Table i Data Table (Click on the icon located on the top-right corner of the data table below in order to copy its contents into a Spreadsheet.) (Click on the icon located on the top-right corner of the data table below in order to copy its contents into a spreadsheet.) Year 1 New machine Expenses (excluding depreciation and interest) $720,700 720,700 720,700 720,700 720,700 Revenue $750,500 750,600 750,600 750,600 750,600 2 Old machine Expenses (excluding depreciation and interest) $659,100 659,100 659,100 659,100 659,100 Revenue $674,100 676,100 680,100 678,100 674,100 4 5 Rounded Depreciation Percentages by Recovery Year Using MACRS for First Four Property Classes Percentage by recovery year Recovery year 3 years 5 years 7 years 10 years 1 33% 20% 14% 10% 2 45% 32% 25% 18% 3 15% 19% 18% 14% 4 7% 12% 12% 12% 5 12% 9% 6 5% 994 8% 7 946 7% 8 6% 9 9 8% 10 6% 11 4% Totals 100% 100% 100% 100% *These percentages have been rounded to the nearest whole percent to simplify calculations while retaining realism. To calculate the actual depreciation for tax purposes, be sure to apply the actual unrounded percentages or directly apply double-declining balance (200%) depreciation using the half-yea convention. Print Done TTOMU Delore depreciate taxes Depreciation Net profit before taxes S S s S Taxes Net profit after taxes S Operating cash inflows S Print Done