The Ally Gator Corporation of Meadville, PA make of Ally's electronic components, is considering replacing one of its current hand-operated assembly machines with a new fully automated machine. Existing situation Original depreciable value of old machine - $50,000 Expected life-10 years Age - 5 years old Expected salvage value in five years - 50 Current salvage value $15.000 Marginal tax rate - 34 percent Proposed situation Fully automated machine resulting in annual savings of $40,000 Cost of machine - $86.000 Installation fee - $8.000 Expected life-five years, depreciated down to $0 Salvage value in 5 years - $25.000 What is the terminal cash flow? $25,000 $20,000 $16,500 $13.200