Printer A: This highly automated printer can be purchased for $830,000 and will require $40,000 in installation costs. It will be depreciated using a five-year straight-line method. At the end of five years the machine can be sold for $400,000 before taxes with a book value of $43,500. If this machine is acquired, it is anticipated that the following current account changes would result:
Cash $ 25,400
Accounts Receivable $ 120,000
Inventories -$ 20,000
Accounts payable $ 35,000
where there are no capital gains on the sale of the old printer tax, determine:
1. Initial investment
2. Operating cash inflows
3. Terminal cash flow [Note: This is at the end of year 5]