John's Company is considering purchasing a new machine to replace an obsolete one. The new...
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John's Company is considering purchasing a new machine to replace an obsolete one. The new machine would cost $75,000, including delivery. It would cost another $20,000 to modify the machine so it could be used. In addition it was cost another $7,000 in net operating working capital. The machine is expected to reduce pre tax costs by $9,000 ayear. John's tax rate is 35%. IF this project was selected, what would the cash flows be for year 0 (CFO)?
A. -96,150
B. -82,000
C. -93,000
D. -102,000
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