Question: Quad Enterprises is considering a new 3 - year expansion project that requires an initial fixed asset investment of $ 2 . 3 7 6

Quad Enterprises is considering a new 3-year expansion project that requires an initial fixed asset investment of $2.376 million. The fixed asset will be depreciated straight-line to zero over its 3-year tax life, after which time it will be worthless. The project is estimated to generate $2,112,000 in annual sales, with costs of $844,800.
If the tax rate is 25 percent, what is the OCF for this project?

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