A company is considering replacing an old machine, which has a market value of $95,000 and a tax basis of $145,000. The new machine would cost $210,000 and would cause a $25,000 reduction in working capital because of the need for fewer spare parts. If the company's tax rate is 39%, what would be the initial cash outlay for this replacement project? 1) $120, 500 2) $159, 500 3) $70.500 4) $129, 500 5) $109, 500