2. Incremental costs - Initial and terminal cash flow Marston Manufacturing Company is considering a project that requires an investment in new equipment of $4,200,000, with an additional $210,000 in shipping and installation costs. Marston estimates that its accounts receivable and inventories need to increase by $840,000 to support the new project, some of which is financed by a $336,000 increase in spontaneous liabilities (accounts payable and accruals). The total cost of Marston?s new equipment is ___________ and consists of the price of the new equipment plus the _______________________________________________ . In contrast, Marston?s initial investment outlay is ______________. Suppose Marston?s new equipment is expected to sell for $1,200,000 at the end of its four-year useful life, and at the same time, the firm expects to recover all of its net working capital investment. The company chose to use straight-line depreciation, and the new equipment was fully depreciated by the end of its useful life. If the firm?s tax rate is 40%, what is the project?s total termination cash flow? $1,224,000 $984,000 $720,000 $1,200,000