King Nothing is evaluating a new 6-year project that will have annual sales of $425,000 and costs of $293,000. The project will require fixed assets of $525,000, which will be depreciated on a 5-year MACRS schedule. The annual depreciation percentages are 20.00 percent, 32.00 percent, 19.20 percent, 11.52 percent, 11.52 percent, and 5.76 percent, respectively. The company has a tax rate of 35 percent. What is the operating cash flow for Year 3? Multiple Choice $81,480 $106,968 $116,425 $121,080 $151,320
King Nothing is evaluating a new 6-year project that will have annual sales of $425,000 and costs of $293,000. The project will require fixed assets of $525,000, which will be depreciated on a 5-year MACRS schedule. The annual depreciation percentages are 20.00 percent, 32.00 percent, 19.20 percent, 11.52 percent, 11.52 percent, and 5.76 percent, respectively. The company has a tax rate of 35 percent. What is the operating cash flow for Year 3? Multiple Choice $81,480 $106,968 $116,425 $121,080 $151,320
Chapter10: Capital Budgeting: Decision Criteria And Real Option
Section10.A: Mutually Exclusive Investments Having Unequal Lives
Problem 2P
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Question
King Nothing is evaluating a new 6-year project that will have annual sales of $425,000 and costs of $293,000. The project will require fixed assets of $525,000, which will be
Multiple Choice
-
$81,480
-
$106,968
-
$116,425
-
$121,080
-
$151,320
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