P$11-20$ Determining incremental operating cash inflows Scenic Tours, Inc., is a provider of

bus tours throughout the New England area. The corporation is considering the

replacement of $10$ of its older buses. The existing buses were purchased $4$ years ago

at a total cost of $$2,700,000$ and are being depreciated using MACRS and a $5-$year

recovery period $($see Table $4\mathrm{.}2,$ page $117).$ The new buses would have larger pas$-$

senger capacity and better fuel efficiency as well as lower maintenance costs. The

total cost for $10$ new buses is $$3,000,000.$ Like the older buses, the new ones would

be depreciated using MACRS and a $5-$year recovery period. Scenic is subject to a tax

rate of $40\%.$ The accompanying table presents revenues and cash expenses

$($excluding depreciation and interest$)$ for the proposed purchase as well as the

present flect. Use all of the information given to calculate incremental $($relevant$)$

operating cash inflows for the proposed bus replacement.