Premier Steel, Inc. is considering the purchase of a new machine for $110,000 that has a useful life of 3 years. The firms cost of capital is 11% and the tax rate is 40%. This machine will be sold for its salvage value of $20,000 at the end of 3-years. The machine will require an investment of $2,500 in spare parts inventory upon installation. The machine will cost $7,500 to ship and $4,500 to install and modify it. Sales are as follows: year 1 = $90,000; year 2 = $97,500; year 3 = $105,000. Operating expenses are year 1 = $25,000; year 2 = $27,000; year 3 = $29,000. The investment in working capital will be liquidated at termination of the project at the end of year 3. What is the free cash flow for year 3?
	Year1	Year2	Year3	Year4
MACRS Rates	33%	45%	15%	7%

A)	$54,820
B)	$52,320
C)	$49,820
D)	$55,420