Create -- income statement and cash flow statement. Show annualized entries for revenue, itemized expenses taxable income, taxes, investment activities and net cash flow. Company is considering a new injection machine. uses MARR of 10%, effective income tax rate is 24%. The machine would depreciate using 7-year MACRS. Useful life: 8 years. Below is all the information given to create income/cash flow statement. IRR

Equipment cost: The purchase cost is $700,000 before taxes. The purchase is subject to 5 % sales tax. The total cost for freight and handling for the injection molding machine is expected to be $65,000. The total cost to install the injection molding machine is $32,000. Testing and startup costs to place the injection molding machine into service are estimated to be $27,000. It is estimated that the injection molding machine can be sold as salvage for a total of $240,000 at the end of the project. This machine requires one operator working per shift and there are two shifts. The cost of each operator is $41.00 per hour and they each work 2000 hours per year. Total annual direct materials are estimated at $370,000. Manufacturing overhead exclusive of depreciation is expected to be $220,000 per year. Revenues: Expected to be $950,000 for year 1 using this machine and then increase by 2% each year thereafter throughout the project