Question: 7 Temporary Housing Services Incorporated (THSp is considering a project that involves setting up a temporary housing damaged by a hurricane. THSI will lease space
7 Temporary Housing Services Incorporated (THSp is considering a project that involves setting up a temporary housing damaged by a hurricane. THSI will lease space in this facility to various agencies and groups facility in an area recenty providing relef services to the area. THSI estimates that this project will initially cost $5 million to set up and will generate $24 million in revenues during its first and only year in operation (paid in one year). Operating expenses are expected to total $12 miltion during this year and depreciation expense will be another $3 million. THSI will require no working capital ths nvestment THS7 margnal tax rate is 35%. gnoring the original investment of $5 million what is THSTs free cash fow for the first and only year of operation? A $11.06 millian . $885 milon O c. $2.85 milion O D. $5.00 million
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