A project creates incremental sales of $ 713,500, incremental costs of $ 447,300 and annual depreciation...
A project creates incremental sales of $ 713,500, incremental costs of $ 447,300 and annual depreciation equal to $ 81,200. The corporate tax rate is 32 %. Calculate the projects operating cash flow (OCF).
Homework Answers
| Sales | $713,500 |
| Costs | $447,300 |
| Depreciation | $81,200 |
| EBIT | $185,000 |
| Taxes($185,000 * 32%) | $59,200 |
| Net income | $125,800 |
OCF = EBIT + Depreciation - Taxes
OCF = $185,000 + $81,200 - $59,200
OCF = $207,000
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