Question: Daily Enterprises is purchasing a $ 1 0 . 2 million machine. It will cost $ 5 0 3 0 0 0 to transport and

Daily Enterprises is purchasing a $10.2 million machine. It will cost $503000 to transport and install the
machine. The machine has a depreciable life of five years using straight-line depreciation and will have
no salvage value. The machine will generate incremental revenues of $4.2 million per year along with
incremental costs of $1.5 million per year. Daily's marginal tax rate is 21%. You are forecasting
incremental free cash flows for Daily Enterprises. What are the incremental free cash flows associated
with the new machine?
The free cash flow for year 0 will be $
(Round to the nearest dollar.)
 Daily Enterprises is purchasing a $10.2 million machine. It will cost

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