You are evaluating the proposed acquisition of a new machine costing $$50,000,$ and it falls into the MACRS $3-$year class. Purchase of the machine would require an increase of net operating working capital of $$2,000,$ which will be recovered when the machine is sold. The machine would increase the firm's revenues by $$27,000$ per year and its operating costs by $$16,000$ per year. The machine is expected to be used only for $3$ years and then be sold for $$25,000.$ The firm's marginal tax rate is $27$ percent, and the project's cost of capital is $14$ percent. What is the non$-$operating terminal cash flows at year $3?$ MACRS $3-$year schedule is as follows: $33\%,45\%,15\%,$ and $7\%$ for years $1$ to $4,$ respectively.

Question $13$ options:

$$20,145$

$$20,455$

$$20,725$

$$20,975$

$$21,195$

$$21,505$

Question $14(2$ points$)$

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Mars Inc. is considering a $5-$year project that requires a new machine that costs $$51,000,$ and an additional net working capital of $$5,000,$ which will be recovered when the project ends in $5$ years. This project would increase the firm's revenues by $$28,000$ per year and its operating costs by $$14,000$ per year. Mars will use the $3-$year MACRS to depreciate the machine, and it expects to sell the machine at the end of the project for $$19,000.$ The firm's marginal tax rate is $27$ percent, and the project's cost of capital is $14$ percent. What is the net cash flow at year $5,$ the final year? MACRS $3-$year schedule is as follows: $33\%,45\%,15\%,$ and $7\%$ for years $1$ to $4,$ respectively.

Question $14$ options:

$$27,370$

$$27,730$

$$28,170$

$$28,570$

$$29,090$

$$29,390$