Question: QUESTION 4 Pierre Wineries is evaluating a project that would require an initial investment in equipment of $80,000 and that is expected to last for
QUESTION 4 Pierre Wineries is evaluating a project that would require an initial investment in equipment of $80,000 and that is expected to last for 6 years. MACRS depreciation would be used where the depreciation rates in years 1, 2, 3, 4 and 5 are 40.0%, 25.0%, 15.0%, 10.0%, and 100%, respectively. For each year of the project, Pierre Wineries expects relevant annual revenue associated with the project to be $43,000 and relevant annual costs associated with the project to be $30,000. The tax rate is so percent. What is ox plus YrX is the relevant operating cash flow (OCF) associated with the project expected in year 1 of the project and is the relevant OCF associated with the project expected in year of the project? a. 516,000 plus or minus $100) b. 535,000 (plus or minus 5100) c. $33,000 plus or minus $100) d. 154.000 plus or minus 51001 e. None of the above is within $100 of the correct
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