Question: Operating cash flow. Huffman Systems has forecasted sales for its new home alarm systems to be 65,000 units per year at $42.00 per unit. The
Operating cash flow. Huffman Systems has forecasted sales for its new home alarm systems to be 65,000 units per year at $42.00 per unit. The cost to produce each unit is expected to be about 38% of the sales price. The new product will have an additional $470,000 of frod costs each year, and the manufacturing equipment wit have an initial cost of $3,000,000 and will be depreciated over eight years (straight line). The company tax rate is 38%. What is the annual operating cash flow for the alarm systems it the projected sales and price pet unit are constant over the next eight years? What is the annual operating cash flow for the alarm systems? (Round to the nearost dollar)
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