A project requires buying a $30,000 equipment, which will be depreciated straight-line to zero over its 5-year life. The project also requires an immediate increase in net working capital of $4,000, which will be fully recovered at the end of year 5. The company has an average tax rate of 40%. The project will generate an annual operating cash flow (OCF) of $15,000 in each of the next three years. At the end of year 3, the equipment will be sold for $5,000 in the market. What is the initial cash flow (project cash flow in year 0) for this project?

Select one:

a. -$26,000

b. -$30,000

c. -$34,000

d. -$45,000

Answer this question based on the information given from the previous question. What is the project cash flow in year 5 for this project?

Select one:

a. $15.000

b. $19,000

c. $22,000

d. $24,000