Question 14 1 pts St. Johns River Shipyards is considering the replacement of an 8-year-old riveting machine with a new one that will increase earnings before depreciation from $22,000 to $56,000 per year. The new machine will cost $100,000, and it will have an estimated life of 8 years and no salvage value. The new machine will be depreciated over its 5-year MACRS recovery period, so the applicable depreciation rates are 20%, 32%, 19%, 12%, 11%, and 6%. The applicable corporate tax rate is 35%, and the firm's WACC is 9%. The old machine has been fully depreciated and has no salvage value. What is the replacement project's NPV? 55,394 50,033 44,963 O 61,067 O 67,076 Previous Next Question 13 1 pts The Campbell Company is evaluating the proposed acquisition of a new milling machine. The machine's base price is $54,000, and it would cost another $6,000 to modify it for special use. The machine falls into the MACRS 3-year class, and it would be sold after 3 years for $24,000. The machine would require an increase in net working capital (inventory) of $2,500. The milling machine would have no effect on revenues, but it is expected to save the firm $25,000 per year in before-tax operating costs, mainly labor. Campbell's marginal tax rate is 40%. MACRS allowance percentages are 0.33, 0.45, and 0.15 for Years 1, 2, and 3, respectively. What is the new project's NPV if the project's cost of capital is 8%? O 7,593 11,805 14,847 8,953 O 10,356