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You must evaluate the purchase of a proposed spectrometer for the R&D department. The base price...

You must evaluate the purchase of a proposed spectrometer for the R&D department. The base price is $110,000 and it would cost another $22,000 to modify the equipment for special use by the firm. The equipment falls into the MACRS 3-year class and would be sold after 3 years for $ 38,500. The applicable depreciation rates are 33%, 45%,15%, 7%. The equipment would require an $10,000 increase in net operating working capital. The project would have no effect on revenues, but it should save the firm $46,000 per year in before-tax labor cost. The firms marginal federal-plus-state tax rate is 40%. What are the projects annual cash flows in Years 1, 2, 3? Round your answer to the nearest cent.

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