$12-11$ REPL.ACEMENT ANALYSIS St$.$ Johns River Shipyards is considering the replacement of an $8-$year$-$old riveting machine with a new one that will increase earnings from $$24,000$ to $$46,000$ per year. The new machine will cost $$80,000,$ and it will have an estimated life of $8$ years and no salvage value. The new riveting machine is eligible for $100\%bo$

$us$ depreciation at the time of purchase. The applicable corporate tax rate is $2546,$ and the firm's WACC is $10\%.$ The old machine has been fully depreciated and has no salvage value. Should the old riveting machine be replaced by the new one? Explain your answer.