Question: Quad Enterprises is considering a new 2 -year expansion project that requires an initial fixed asset investment of $4.752 million. The fixed asset will be

 Quad Enterprises is considering a new 2 -year expansion project that

Quad Enterprises is considering a new 2 -year expansion project that requires an initial fixed asset investment of $4.752 million. The fixed asset will be depreciated straight-line to zero over its 2 -year tax life, after which time it will be worthless. The project is estimated to generate $4,224,000 in annual sales, with costs of $1,689,600. If the tax rate is 22 percent, what is the OCF for this project? Multiple Choice $2,499,552 $2,624,530 $123,552 $2,374,574 $2,534,400

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!