Atlantic Control Company purchased a machine 2 years ago at a cost of $70,000. The machineis being depreciated using simplified straight-line over its 7-year class life. The machine would

have no salvage value at the end of year 7, but could be sold now for $40,000. A new replacement machine can be purchased for $80,000. The new machine would bedepreciated over 5 years. Rapidly changing technology has necessitated this project. Deliveryand installation charges will amount to $10,000 and net working capital investment of $5,000will be required at installation. The new machine will not increase sales, but will reduceoperating costs by $20,000 per year. The firm's marginal tax rate is 35%. What is the initialoutlay for the project?

a) -$46,500  d) -$69,000b) -$95,000  e) -$51,500c) -$55,000