Isaac, Inc. is thinking about purchasing a new machine. The new machine would cost $150,000 with an additional $30,000 for delivery of the machine. The machine will have a life of 5 years and will be depreciated using the straight line method. The machine can be sold for $25,000 at the end of its life. This machine is expected to produce cost savings of $35,000 the first two years and $50,000 per year after. It will take a $10,000 adjustment to net working capital if the machine is purchased. The company has a required return of 7% and is in the 35% tax bracket. Calculate the NPV of the project and determine if the company should purchase the machine.

Year	1	2	3	4	5
Cost Savings
Depreciation
EBIT
Taxes
Net Income
OCF

Year	0	1	2	3	4	5
OCF
Change in NWC
Capital Investment
Net CF