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. Total cost for this equipment is $$400,000$ including delivery and installation of equipment. 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 $$150,000$ annually in pre$-$tax operating costs.

Your company's federal$-$plus$-$state effective tax rate is $30\%$

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

$$65,000$

$$115,000$

$$120,000$

$$106,000$