Question: A. Bennett Co. has a potential new project that is expected to generate annual revenues of $262,100, with variable costs of $144,000, and fixed costs

Bennett Co. has a potential new project that is expected to generate annual revenues of $262,100, with variable costs of $144,000, and fixed costs of $61,300. To finance the new project, the company will need to issue new debt that will have an annual interest expense of $24,500. The annual depreciation is $25,200 and the tax rate is 34 percent. What is the annual operating cash flow?

A project with a life of 7 years is expected to provide annual sales of $470,000 and costs of $341,000. The project will require an investment in equipment of $805,000, which will be depreciated on a straight-line method over the life of the project. You feel that both sales and costs are accurate to +/-10 percent. The tax rate is 35 percent. What is the annual operating cash flow for the best-case scenario?

A project with a life of 7 years is expected to provide annual sales of $310,000 and costs of $213,000. The project will require an investment in equipment of $565,000, which will be depreciated on a straight-line method over the life of the project. You feel that both sales and costs are accurate to +/-10 percent. The tax rate is 34 percent. What is the annual operating cash flow for the best-case scenario?

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