Problem:
A new machine can be purchased for $1,800,000. It will cost $35,000 to ship and $15,000 to fine-tune the machine. The new machine will replace an older version that is fully depreciated and will be sold for $200,000. The firm's income tax rate is 35%.
Required:
Question: What is the initial outlay for capital budgeting purposes?
Note: Explain all steps comprehensively.