Ssntosh Plastics inc, purchased a new machine one year ago at a cost of 5905,000 . Although the machine operates well and has five moce years of operating lfe, the president of Sariosh filstics is wondering if the cornpary shoivid reploce it with a new electronic fachine that has just come on the market. The new msctine costs $157,500 and is expected to slash the current aniual operating costs of $73,500 by two thicds. The new machine is expected to last for five years, with zero selvage value at the end of five years. The curreat machine can be wold for $17,500 if the company decides so buy the rew machine. The company uses staight tine depreciation. In tryen to docide whether to purchase the new machine, the president has pepered the following andysis: "Even though the new machine looks good," said the president "we can't got rid of that oid machine if it means taking a huge loss on it. Weil have to ute the dld machine for at least a few more years." Sales are expected to be $367,500 por yea, and selling and administrative experses are expected to be 5220,500 per year, regardless of which machine is used. Required: 1. Prepare a contparativo income stotement covering the next five years, assuming: a. The new machine is not purchased. b. The new machine is purchased. (Negative amounts ahould be indicated by a minus sign. Do not round intermediate calculations.) 2. Compute the net edvantage of purchasing the new mbchine using only relevant costs in your analysis. (Do not round intermediate calculations.) 3. What is the minimum saving in annual operating costs that must be achieved in order for the president to consider buging the new mactine