Question: Please disregard the increase/ and or decrease options that have been preselected. I selected them myself and am not sure of their accuracy. A project
Please disregard the increase/ and or decrease options that have been preselected. I selected them myself and am not sure of their accuracy.
A project currently generates sales of $10 million, variable costs equal to 50% of sales, and fixed costs of $2 million. The firm's tax rate is 35%. a. What are the effects on the after-tax profits and cash flow, if sales increase from $10 million to $11 million. (Input all amounts as positive values. Do not round intermediate calculations. Enter your answers in millions rounded to 3 decimal places.) by $ by $ After-tax profitincreased Cash flow increased million million b. What are the effects on the after-tax profits and cash flow, if variable costs increase to 65% of sales. (Input all amounts as positive values. Do not round intermediate calculations. Enter your answers in millions rounded to 3 decimal places.) After-tax profit decreased by $ by $ 748 million. Cash flow million. (Click to select)
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