Windsor Corporation is considering an investment which will require the purchase of a machine. The machine costs #800.000, has a class life of a 5 years, and will be depreciated using simplified straight-line depreciation. The firm's marginal tax rate is 35%. The incremental cash inflows expected over the 5-year life of the project are $240, 000 per year, and cash expenses are $80.000 per year. In addition, the new machine will reduce defects by $15, 000 per year. The new machine will require a one-time increase in net working capital of $25, 000 at the time installation. At the end of 5 years, the machine will be worthless, and the firm will not replace it. Calculate the annual cash flow resulting from this project. $169, 750 $160, 000 $94, 250 $9, 750 $171, 500 Heron Corporation is planning to add manufacturing capacity by installing new high-tech machines. The machines would increase revenues by $180, 000 per year and .increase costs by $50 000 per year. The new machines cost $560, 000 and would be depreciated over 5 years using simplified straight line. Investment in net working capital of $30, 000 would be time of installation the firm is planning to keep the machines for 7 years and then sell them for $80.000 The firm has a required rate of return on investment projects of 13% a marginal tax rate of 34%. What is the net present value of this project? -$54, 161 -$41, 409 $283, 800 -$45, 458 -$34, 234