Problem $12-6$ Project Cash Flows $($LG$12-3)$

KADS, Inc. has spent $$500,000$ on research to develop a new computer game. The firm is planning to spend $$300,000$ on a machine to produce the new game. Shipping and installation costs of the machine will be capitalized and depreciated; they total $$60,000.$ The machine has an expected life of three years, a $$85,000$ estimated resale value, and falls under the MACRS $7-$year class life. Revenue from the new game is expected to be $$700,000$ per year, with costs of $$350,000$ per year. The firm has a tax rate of $21$ percent, an opportunity cost of capital of $11$ percent, and it expects net working capital to increase by $$150,000$ at the beginning of the project.

What will the cash flows for this project be$?($Negative amounts should be indicated by a minus sign. Round your answers to $2$ decimal places.$)$

FCF: year $0?$ year $1?$ year $2?$ year $3?$