A B D E G H mm 31 32 33 34 12-2 PROJECT CASH FLOW 35 Eisenhower Communications is trying to estimate the first-year cash flow 36 (at Year 1) for a proposed project. The financial staff has collected the 37 following information on the project: 38 39 Sales revenues $ 12.70 million 40 Operating costs (excluding depreciation) $ 9.30 million 41 Depreciation $ 2.20 million 42 Interest expense $ 2.40 million 43 Tax rate 37.0% 44 WACC 13.3% 45 a. What is the project's cash flow for the first year t 1? 46 47 48 49 50 51 52 53 54 55 11 P4,5,6+additional 12 P1,2,3 + + HB H A B D E F G $1 52 53 54 55 56 b. If this project would cannibalize other projects by $1 million of cash 57 flow before taxes, how would this change your answer to Parta? 58 59 50 61 c. Ignore Part b. If the tax rate moved to 30.00%, how would that change 62 your answer to Part a? 63 64 65 66 67 68 69 70 71 72 79