Starset Machine Shop is considering a 4-year project to
improve its production efficiency. Buying a new machine press for
$405,000 is estimated to result in $157,000 in annual pretax cost
savings. The press falls in the 5-year MACRS class, and it will
have a salvage value at the end of the project of $57,000. The
press also requires an initial investment in spare parts inventory
of $24,000, along with an additional $3,300 in inventory for each
succeeding year of the...