1.Assume Mary Ann Company has a current revenue of $2 M with an annual cash expense =...
Question:
1.Assume Mary Ann Company has a current revenue of $2 M with an annual cash expense = $1.5M, Depreciation =$200,000 the Marginal tax rate = 40%. The company is seeking purchase e new machine costing $3.5 M with a useful life of 10 years (meaning no salvage value). To get the asset in place and for operation require a further installation charge of $50,000. Transportation charge of $2.000 and net working capital of $40,000. Revenues will grow to $3.0 M annual expenses will = $520,000. Using the straight line depreciation method the net cash flow per year will be?
SOLN:
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ANS:$________