3. Pete Inc. is considering purchasing a new machine to improve its production efciency. The company paid $5,000 to a consultant to evaluate the various models available in the market and nally decided that Model PU is the best. The new machine PU costs $576,000 and is estimated to result in annual pretax cost savings of $192,000 for 4 years. The machine falls in the MACRS 5year class, and it will have a salvage value at the end of the project of $84,000. The machine also requires an initial investment in spare parts inventory of $24,000, along with an additional $3,600 in inventory for each of the first 3 years of the project. The company's tax rate is 35 percent. Calculate the project cash ow for each year, i.e. year 0-4. MACRS Table 5 Years MACRS Percentage 20.00%