Saratoga Pix currently uses a six-year-old molding machine to manufacture silver picture frames. The company paid $104,000 for the machine, which was state of the art at the time of purchase. Although the machine will likely last another ten years, it will need a $11,000 overhaul in four years. More important, it does not provide enough capacity to meet customer demand. The company currently produces and sells 15,000 frames per year, generating a total contribution margin of $99,000