Question: Problem 9-9 Calculating Project OCF [LO 2] Cochrane, Inc., is considering a new three-year expansion project that requires an initial fixed asset investment of $2,310,000.

Problem 9-9 Calculating Project OCF [LO 2]

Cochrane, Inc., is considering a new three-year expansion project that requires an initial fixed asset investment of $2,310,000. The fixed asset will be depreciated straight-line to zero over its three-year tax life, after which time it will be worthless. The project is estimated to generate $2,220,000 in annual sales, with costs of $1,210,000.

Required:

If the tax rate is 30 percent, what is the OCF for this project? (Do not round intermediate calculations. Enter your answer in dollars, not millions of dollars (e.g., 1,234,567).)

OCF

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