Alternative $1$: Keep the old machine and have it overhauled. This requires an initial investment of $$151,000$ and results in $$41,000$ of net cash flows in each of the next five years. After five years, it can be sold for a $$22,000$ salvage value.

Alternative $2$: Sell the old machine for $$37,000$ and buy a new one. The new machine requires an initial investment of $$301,000$ and can be sold for a $$7,000$ salvage value in five years. It would yield cost savings and higher sales, resulting in net cash flows of $$65,000$ in each of the next five years.