e File Edit View oo / History Bookmarks People Window Help S Year Cash Flow 0-$7

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e File Edit View oo / History Bookmarks People Window Help S Year Cash Flow 0-$7,600 1 3 D Connect Assignment #5 (Sum x x Question 3 (of ) 3. 100 points value: Quad Enterprises is considering a new three-year expansion project that requires an iniial fixed asset investment of $2.46 million. The foxed 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 $2,000,000 in annual sales, with costs of $695,000. If the tax rate is 35 percent, what is the OCF for this project? (Do not round intermediate calculations. Enter your answer in dollars, not millions of dollars, e-g.1,234,567.) References eBook &Resources; Worksheet Learning Objective: 10-01 How to determine the relevant cash flows for a proposed project. Section: 10.3 Pro Forma Financial Statements and Project Cash Flows Difficulty: Basic

Explanation / Answer

Working:

Operating cash flows $ 11,35,250

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