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Darlington Equipment Company purchased a machine 5 years ago at a cost of $95,000. The machine had an expected life of 10 years at the time of purchase, and it being depreciated by the straight-line method by $9,500 per year. If the machine is not replaced, it can be sold for $15,000 at the end of its useful life. new machine can be purchased for $160,000, including installation costs. During its 5 -year life, it will reduce cash operating expenses by $45, co0 per year. Sales are ot expected to change. At the end of its useful life, the machine is estimated to be worthless. The new machine is eligible for 100% bonus depreciation at the time of urchase. The old machine can be sold today for $55,000. The firm's tax rate is 25%. The appropriate WACC is 9%. a. If the new machine is purchased, what is the amount of the initial cash flow at Year 0 after bonus depreciation is considered? Cash outflew should be indicated by a minus sian. Round your answer to the nearest dollar. 5 b. What are the incremental cash flows that will occur at the end of Years 1 through 5 ? Round your-answers to the nearest dollar. Year 1 Year 2 Year 3 Year 4 Year 5 5 8 3 3 5 c. What is the NPV of this project? Do not round intermediate calculations. Round your answer to the nearest cent, $ Should Darlington replace the old machine

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