13. Problem 11-02 (Project Cash Flow)

Project Cash Flow

The financial staff of Cairn Communications has identified the following information for the first year of the roll-out of its new proposed service:

Projected sales	$22 million
Operating costs (not including depreciation)	$9 million
Depreciation	$5 million
Interest expense	$3 million

The company faces a 25% tax rate. What is the project's operating cash flow for the first year (t = 1)? Enter your answer in dollars. For example, an answer of $1.2 million should be entered as $1,200,000. Round your answer to the nearest dollar.

$