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Please see attatched A firm has an opportunity to invest in a new device that will replace two of the firm's older machines. The new
Please see attatched
A firm has an opportunity to invest in a new device that will replace two of the firm's older machines. The new device costs $600,000 and requires an additional outlay of $10,000 to cover installation and shipping. The new device will cause the firm to increase its net working capital by $10,000. Both of the old machines can be sold-the first for $100,000 (book value equals $90,000) and the second for $150,000 (book value equals $135,000). The original cost of the first machine was $200,000, and the original cost of the second machine was $140,000. The firm's marginal tax bracket is 40 percent. Compute the net investment for this project. Round your answer to the nearest dollar. $Step by Step Solution
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