Terminal cash flow: Replacement decision 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 $$200,000$ and will require $$30,000$ in installation costs. It will be depreciated under MACRS, using a $5-$year recovery period $($see Table $4\mathrm{.}2$ for the applicable depreciation percentages$).$ A $$25,000$ increase in net working capital will be required to support the new machine. The firm$$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 $$15,000$ before taxes; the new machine at the end of $4$ years will be worth $$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.