Question: Daily Enterprises is purchasing a $10.1 million machine. It will cost $55,000 to transport and install the machine. The machine has a depreciable life of


Daily Enterprises is purchasing a $10.1 million machine. It will cost $55,000 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 $4.4 million per year along with incremental costs of $1.2 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 $50,000 to transport and install the machine. The machine has a depreciable life of five years and will have no salvage value. Assume that CCA deductions are the same as depreciation expenses. The machine will generate incremental revenues of $3.9 million per year along with incremental costs of $1.2 million per year. It Daily's marginal tax rate is 35%, what are the incremental earnings associated with the new machine? The annual incremental earnings a $ (Round to the nearest dollar.)
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