Cuds Marine Eingines, Inc, must develop the cash flow estimates for a replacement eapital investment proposal. The proposed asset costs $500,000$ and has instalidion oosts of $51,$oo$0.$ The ancer percert tax rate. into wocourt when evaluating the purchase of new equipment lodiay?

A$.$ The $55,000$ reduces the inital cash outiey required to purchase the new aspet

E$.$ The $$5\mathrm{.}000$ is impievart because if Cuda buys the new aviet, it will sell the old equipmert lioday for $$10\mathrm{.}000$ and it will not sell if for $$5$ p$00$ five years from now

C$.$ anabite thould not try to account for this information because what the compary will dedide to do five years from now is top uncertain

D$.$ The $55,000$ is an oppofinity coet and ahould be treated as a cash outlow in the year $5$ project eash flow estimates for the new atset