You are evaluating a capital project to replace a control device with a newer model which costs $29,000, delivered. An additional $3000 will be needed to install the device. The new device has an estimated 20-year service life. The estimated salvage at the end of the life of the device is $2000.The existing device has been in service 12 years and is fully depreciated; its scrap value is $1000. The old device could be used indefinitely, assuming the firm is willing to pay for its high maintenance costs. The new device requires less maintenance and frees up personal who would normally have to monitor the system. Estimated cost savings from the new device will be $9000 annually. The firm has a 40% marginal tax rate and a 12% weighted average cost of capital. Calculate Initial Outlay and NCF .

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