Initial cash flow: Basic calculation Cushing Corporation is considering the purchase of a new grading machine to replace the existing one. The existing machine was purchased $2$ years ago at an installed cost of $$19,000$; it was being depreciated under MACRS using a $5-$year recovery period. $($See table for the applicable depreciation percentages.$)$ The existing machine is expected to have a usable life of at least $5$ more years. The new machine costs $$35,900$ and requires $$5,300$ in installation costs; it will be depreciated using a $5-$year recovery period under MACRS. The existing machine can currently be sold for $$24,900$ without incurring any removal or cleanup costs. The firm is subject to a $21\%$ tax rate. Calculate the initial cash flow associated with the proposed purchase of a new grading machine.

The initial cash flow will be $

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Data table

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Rounded Depreciation Percentages by Recovery Year Using MACRS for First Four Property Classes

Percentage by recovery year$*$

$\backslash$table$[[,$Percentage by recovery year$*],[$Recovery year,$3$ years,$5$ years,$7$ years,$10$ years$],[1,33\%,20\%,14\%,10\%$