Suppose a company is evaluating a new project which entails the acquisition of equipment which will have no impact on sales revenues but will reduce the company's operating costs. Assume the following information:

* The equipment will be depreciated straight-line over 8 years, so depreciation will be $50,000 per year.

* The equipment will save your company $130,000 annually in pre-tax operating costs.

* Your companys effective tax is 30%

What is the expected net cash flow for the first year if the company invests in this equipment?

a. $56,000

b. $141,000

c. $110,000

d. $106,000