Problem:
The company C is considering the acquisition of a new machine that will last for 20 years. The machine costs $500,000 and belongs to CCA class 8 (CCA rate: 20%). The machine would require an investment in net working capital of $25,000 in year 1. The machine will generate annual pre-tax operating revenue of $150,000. The company's marginal tax is 40%.
Required:
Question: What is the after-tax operating cash flow for year 2?
Note: Please provide full description.