A 4-year project has an annual operating cash flow of $58,500. At the beginning of the...

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A 4-year project has an annual operating cash flow of $58,500. At the beginning of the project, $4,950 in net working capital was required, which will be recovered at the end of the project. The firm also spent $23,800 on equipment to start the project. This equipment will have a book value of $5,220 at the end of the project, but can be sold for $6,090. The tax rate is 21 percent. What is the Year 4 cash flow? A 4-year project has an annual operating cash flow of $58,500. At the beginning of the project, $4,950 in net working capital was required, which will be recovered at the end of the project. The firm also spent $23,800 on equipment to start the project. This equipment will have a book value of $5,220 at the end of the project, but can be sold for $6,090. The tax rate is 21 percent. What is the Year 4 cash flow?

Answer rating: 100% (QA)

To calculate the Year 4 cash flow we need to determine the salvage value of the equipment the taxes ... View the full answer