Free Enterprise Corp. is considering replacing its old production machine with a new one. The new machine costs $$45,000$; installation and delivery cost $$4,000.$ Working capital requirements for the new machine are $$5,000$ immediately, and training costs amount to $$6,000.$ The old machine can be sold for $$10,000$; its book value is zero. Free Enterprise has a marginal tax rate of $40\%.$ The new machine Free Enterprise Corp is considering buying will increase revenues by $$10,\frac{000}{y}r$ and decrease costs by $$15,\frac{000}{y}r.$ They expect to use the machine for $6$ years and sell it for $$20,000$ in $6$ years. Machine class is $7$ years asset class. Free Enterprise uses the modified accelerated cost recovery system $($MACRS$)$ for depreciation. $($Use the table provided in the formula sheet$)$

What is the initial investment $($IO$)?$

What is the Operating cash flow in year $3?$

What is the Depreciation tax shared in year $5?$

What is the Terminal Cash flow?

What is the TOTAL cash flow in year $6?$