Russell Industries is considering replacing a fully depreciated machine that has a remaining useful life of 10 years with a newer, more sophisticated machine. The new machine will cost $ 207,000 and will require $ 30,500 in installation costs. It will be depreciated under MACRS using a 5-year recovery period (see the table for the applicable depreciation percentages).

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%	9%
6		5%	9%	8%
7			9%	7%
8			4%	6%
9				6%
10				6%
11				4%
Totals	100%	100%	100%	100%

A $ 27,000 increase in net working capital will be required to support the new machine. The firm's managers plan to evaluate the potential replacement over a 4-year period. They estimate that the old machine could be sold at the end of 4 years to net $ 14,800 before taxes; the new machine at the end of 4 years will be worth $ 75,000 before taxes. Calculate the terminal cash flow at the end of year 4 that is relevant to the proposed purchase of the new machine. The firm is subject to a 40 % tax rate. The terminal cash flow for the replacement decision is shown below:(Round to the nearest dollar.)

Proceeds from sale of new machine $

Tax on sale of new machine

Total after-tax proceeds-new asset $

Proceeds from sale of old machine $

Tax on sale of old machine

Total after-tax proceeds-old asset $

Change in net working capital

Terminal cash flow $