Terminal cash$$ flow:$$Various lives and sale prices$$Looner Industries is currently analyzing the purchase of a new machine that costs $ $162$ comma $000$

and requires $ $19$ comma $600$

in installation costs. Purchase of this machine is expected to result in an increase in net working capital of $ $29$ comma $600$

to support the expanded level of operations. The firm plans to depreciate the machine under MACRS using a$$ five$-$year recovery period$($see the table

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for the applicable depreciation$$ percentages$)$ and expects to sell the machine to net $ $10$ comma $100$

before taxes at the end of its usable life. The firm is subject to a $21\%$

tax rate.

a$.$ Calculate the terminal cash flow for a usable life of $(1)$ three$$ years, $(2)$ five$$ years, and$(3)$ seven years.

b$.$ Discuss the effect of usable life on terminal cash flows using your findings in part a$.$

c$.$Assuming a$$ five$-$year usable$$ life, calculate the terminal cash flow if the machine were sold to net$(1)$ $ $9$ comma $080$

or$(2)$ $ $169$ comma $700$

$($before taxes$)$ at the end of five years.

d$.$ Discuss the effect of sale price on terminal cash flow using your findings in part c$.$