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6- 6) (28 points) A company is considering the purchase of new material handling equipment, which costs $600,000. This equipment is expected to reduce labor costs b y $250,000 per year. The estimated annual . 0&M costs are estimated to be $50,000. Its estimated salvage value at the end of its useful life of 4 years Will be $90,000. This new equipment is a MACRS -GDS 3-year property for calculating depreciation deductions. The effective tax rate is 35%. a) (20 points) For this new equipment, determine the after-tax cash ow for each year of operation. (Round off values to the nearest dollar MACRS-GDS Deduction b) (8 points) If the aertax MARR is 10% per year compounded annually, compute the PW of the alter-tax cash ows. Based on this PW, would you recommend the purchase of this new equipment