Question: Squad Inc. is considering a new three-year expansion project that requires an initial fixed asset investment of $1.42 million. The fixed asset will be depreciated

Squad Inc. is considering a new three-year expansion project that requires an initial fixed asset investment of $1.42 million. 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 $1.600 million in annual sales, with costs of $560,000. If the tax rate is 21 percent, what is the OCF for this project? O A. $1,040,000 O B. $821,600 O C. $473,333 O D. $921,000 OE. $1,513,333

Squad Inc. is considering a new three-year expansion project that requires an initial fixed asset investment of $1.42 million. 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 $1.600 million in annual sales, with costs of $560,000. If the tax rate is 21 percent, what is the OCF for this project? A. $1,040,000 B. $821,600 C. $473,333 D. $921,000 E. $1,513,333

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