Year 1			Year 2			Year 3			Year 4
Earnings before depreciation and taxes	$			$			$			$
Depreciation
Earnings before taxes	$			$			$			$
Taxes
Earnings after taxes	$			$			$			$
Depreciation
Cash flow	$			$			$			$

Telstar Communications is going to purchase an asset for $300,000 that will produce $140,000 per year for the next four years in earnings before depreciation and taxes. The asset will be depreciated using the three-year MACRS depreciation schedule in Table 1212. (This represents four years of depreciation based on the half-year convention.) The firm is in a 25 percent tax bracket.

Fill in the schedule below for the next four years.