USE THE INFORMATION BELOW TO ANSWER THE NEXT 3 QUESTIOS

The president of Real Time Inc. has asked you to evaluate the proposed acquisition of a new computer.The computer's price is $40,000 including shipping and installation costs, and it falls into the MACRS 3-year class (i.e., depreciation allowances in years 1-4 are 33%, 45%, 15% and 7% respectively.Purchase of the computer would require an increase in net operating working capital of $2,000.The computer would increase the firm's before-tax revenues by $20,000 per year but would also increase operating costs by $5,000 per year.The computer is expected to be used for 3 years and then be sold for $25,000.The firm's marginal tax rate is 40 percent, and the project's cost of capital is 14 percent.

27.What is the operating cash flow in Year 1?

a.$ 9,000

b.$14,280

c.$11,687

d.$13,453

e.$16,200