Question: A new project will cost $100,000. It will yield new sales revenues of $496,000. It will increase annual variable costs by $416,000 and annual fixed
A new project will cost $100,000. It will yield new sales revenues of $496,000. It will increase annual variable costs by $416,000 and annual fixed costs by $15,000. The project will also require initial investment of $22,000 in net working capital. The project will last for four years, and depreciation will be straight-line to zero. Given that the required rate of return on this project is 18%, and the marginal corporate tax rate is 40%, what is the year 2 operating cash flow from this project? Select an answer and submit. For keyboard navigation, use the up/down arrow keys to select an answer. a $47,333.33 b $52,333.33 $49,000 d $39,000 3 Full $26,000
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