69. Summarize the incremental after-tax cash flow (relevant cash flows) for years t = 0 through t = 5. (See Table 2)

Table 2 Degnan Dance Company, Inc., a manufacturer of dance and exercise apparel, is considering replacing an existing piece of equipment with a more sophisticated machine. The following information is given. Existing Machine Cost = $100,000 Purchased 2 years ago Depreciation using MACRS Over a 5-year recover schedule Current market value = $105,000 Five year usable life remaining Facts Proposed Machine Cost = $150,000 Installation = $20,000 Depreciation-the MACRS 5-year recovery schedule will be used Five year usable life expected Earnings before Depreciation and Taxes Existing Machine Proposed Machine Year 1 $160,000 Year 1 $170,000 2 150,000 2 170,000 3 140,000 3 170,000 4 140,000 4 170,000 5 140,000 5 170,000 The firm pays 40 percent taxes on ordinary income and capital gains. 64. Calculate the book value of the existing asset being replaced. (See Table 2) 65. Calculate the tax effect from the sale of the existing asset. (See Table 2) 66. Calculate the initial investment required for the new asset. (See Table 2) 67. Calculate the incremental earnings before depreciation and taxes. (See Table 2) 68. Calculate the incremental depreciation. (See Table 2)