Your company is contemplating the purchase of a large stampingmachine. The machine will cost $161,000. With additionaltransportation and installation costs of $5,000 and $12,000?,?respectively, the cost basis for depreciation purposes is$178,000. Its MV at the end of five years is estimated as $39,000.The IRS has assured you that this machine will fall under a threeyear MACRS class life category. The justifications for this machineinclude $39,000 savings per year in labor and $26,000 savings peryear in reduced materials. The? before-tax MARR is 25?% per? year,and the effective income tax rate is 50?%. Assume the stampingmachine will be used for only three? years, owing to the? company'slosing several government contracts. The MV at the end of yearthree is $50,000. What is the income tax owed at the end of yearthree owing to depreciation recapture? (capital gain)?

Choose the correct answer below.

A. The income tax owed at the end of year three is $11,815.

B. The income tax owed at the end of year three is $24,000.

C. The income tax owed at the end of year three is ?$36,810.

D. The income tax owed at the end of year three is ?$23,629.

E. The income tax owed at the end of year three is ?$18,405.

The answer is A. Can you please show the steps to solve this inExcel?