The total annual cash inflows associated with the new machine for capital budgeting purposes is $10,400.
From the information, the company does benefits from two types of Cash Inflow increases and these are reduction in the part-time help expense and increased Contribution Margin due to sales.
The increase in sales = 2,500 unit * $2 = $5,000
The Increased Cash Inflow is:
= Part Time help expense eliminated + Increased Sales
= $5,400 + $5,000
= $10,400.
Therefore, the total annual cash inflows associated with the new machine for capital budgeting purposes is $10,400.