The following information pertains to Q26 through 30 below. …

The fоllоwing infоrmаtion pertаins to Q26 through 30 below.  Horizon Medicаl Center is considering purchasing a special-purpose diagnostic machine. The machine would cost $100,000 and would reduce cash operating costs by $30,000 per year for the next 5 years. The machine is expected to have no terminal disposal value at the end of 5 years. Horizon Medical Center uses straight-line depreciation (i.e., annual depreciation expense = $100,000 ÷ 5 = $20,000.) The required rate of return is 10%, and the income tax rate is 30%.  Assume all cash flows occur at year-end except for the initial investment. What is the annual after-tax cash flow from purchasing the machine?