Question: Can someone explain this step by step please? Thanks! Year 0 Revenues - Manufacturing Expenses - Marketing Expenses - Depreciation - EBIT - Taxes (40%)

Can someone explain this step by step please? Thanks! Year 0 RevenuesCan someone explain this step by step please? Thanks!

Year 0 Revenues - Manufacturing Expenses - Marketing Expenses - Depreciation - EBIT - Taxes (40%) = Unlevered net income +Depreciation - Changes Net Working Capital - Capital Expenditures = Free Cash Flow Years 1 to 10 4.3 -0.5 -0.25 -0.5 3.05 -1.22 1.83 +0.5 -0.4 -6 1.93 Panjandrum Industries, a manufacturer of industrial piping, is evaluating whether it should expand into the sale of plastic fittings for home garden sprinkler systems. It has made the above estimates of free cash flows resulting from such a decision (all quantities in millions of dollars). There are some concerns that estimates of manufacturing expenses may be low, due to the rising cost of raw materials. What is the difference in manufacturing expense for break-even point, if all other estimates are correct and the cost of capital is 9%? A) $1.99 million B) $1.66 million C) $2.32 million D) $1.83 million Year 0 Revenues - Manufacturing Expenses - Marketing Expenses - Depreciation - EBIT - Taxes (40%) = Unlevered net income +Depreciation - Changes Net Working Capital - Capital Expenditures = Free Cash Flow Years 1 to 10 4.3 -0.5 -0.25 -0.5 3.05 -1.22 1.83 +0.5 -0.4 -6 1.93 Panjandrum Industries, a manufacturer of industrial piping, is evaluating whether it should expand into the sale of plastic fittings for home garden sprinkler systems. It has made the above estimates of free cash flows resulting from such a decision (all quantities in millions of dollars). There are some concerns that estimates of manufacturing expenses may be low, due to the rising cost of raw materials. What is the difference in manufacturing expense for break-even point, if all other estimates are correct and the cost of capital is 9%? A) $1.99 million B) $1.66 million C) $2.32 million D) $1.83 million

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