0 x Ch 12. End-of-Chapter Problems. Cash Flow Estimation and Risk Analysis 8. Problem 12.10 (kepiacement Analysis) eBook The Dauten Toy Corporation currently uses an injection molding machine that was purchased prior to the new tax legation. This machine steng deprecated on a straight-line basis, and it has 6 years of remaining life. Its current book value is $2,400, and it can be sold for $2.500 at this time Thus, the annual depreciation expense is $2,400/6 - $100 per year. If the old machine is not replaced, it can be sold for $500 at the end of its life. Dauten is offered a replacement machine which has a cost of $8,000, an estimated useful life of 6 years, and an estimated salvage war of SNOO The replacement machine is eligible for 100% bonus depreciation at the time of purchase. The replacement machine would permitan output expansion, sales would rise by $800 per year, even so, the new machine's much greater efficiency would cause operating expenses to decine by $1.500 per yem. The new machine would require that inventories be increased by $2,000, but accounts payable would simultaneously increase by $500: Deuters marginal federal-plus-state tax rate is 25%, and its WACC is 11% What is the NPV of the incremental cash flow stream? Negative value, if any, should be indicated by a minut sign, Round your answer to the neare cent $ Should the company replace the old machine? Select