The president of the company you work for has asked you to evaluate the proposed acquisition of a new chromatography for the firm's R&D department . The equipment's basic price is $ 160 , 000 , and it would cost another $ 24 , 000 to modify it for special use by your firm . The chromatography , which falls into the MACRS 3 - year class , would be sold after 3 years for $56 , 000 . The MACRS rates for the first 3 years are 0. 3.333 , 0. 4445 and 0. 1481 . Use of the equipment would require an increase in net working capital ( spare parts inventory ) of $9 , 600 . The machine would have no effect on revenues , but it is expected to save the firm* $64, 000 per year in before- tax operating costs , mainly labor . The firm's marginal federal -plus- state tax rate 15 40% / }