Hello
YOUR REQUIRED ANSWER IS OPTION D $375
Operating Cashflow = ($1000(Revenue) - $600(VC) - $300(Depreciation))*0.75 + $300 = $375
You obtain the following data for year 1: Revenue = $1000; Variable costs = $600; Depreciation...
23. Based on the following data, what is the horizon value at the end of year 5? Year 1 Revenue 700.00 Fixed costs 90.00 Variable costs 220.00 Additional investment in NWC 3.00 Additional investment in operating long-term assets 80.00 Depreciation 75.00 Tax rate 0.40 The free cash flow is expected to grow at 8% per year from year 1 to year 5 and 6% per year after year 5 to infinity. WACCcomp = 12%. Select one: a. $4,350.39 b. $4,322.04...
1) A five-year project is expected to generate annual revenues of $159,000, variable costs of $72,500, and fixed costs of $15,000. The annual depreciation is $19,500 and the tax rate is 21 percent. What is the annual operating cash flow? 2) Your local athletic center is planning a $1.2 million expansion to its current facility. This cost will be depreciated on a straight-line basis over a 20-year period. The expanded area is expected to generate $745,000 in additional annual sales....
The owner of a bicycle repair shop forecasts revenues of $232,000 a year. Variable costs will be $68,000, and rental costs for the shop are $48,000 a year. Depreciation on the repair tools will be $28,000. a. Prepare an income statement for the shop based on these estimates. The tax rate is 20%. b. Calculate the operating cash flow for the repair shop using the three methods given below: Now calculate the operating cash flow. Dollars in minus dollars out....
A five-year project is expected to generate annual revenues of $ 159,000, variable costs of $72,500, and fixed costs of $15,000. The annual depreciation is $19,500 and the tax rate is 21 percent. What is the annual operating cash flow?
A cost-cutting project will decrease costs by $64,700 a year. The annual depreciation will be $14,700 and the tax rate is 34 percent. What is the operating cash flow for this project? A.$47,700 B. $42,702 C.$37,702 D.$26,996 E.$17,000
Depreciation and accounting cash flow A firm in the third year of depreciating its only asset, which originally cost $173,000 and has a 5-year MACRS recovery period , has gathered the following data relative to the current year's operations: Accruals $15,300 Current assets 117,000 Interest expense 15,200 Sales revenue 413,000 Inventory 69,600 Total costs before depreciation, interest and taxes 297,000 Tax rate on ordinary income 21% a. Use the relevant data to determine the operating cash flow for the current...
A cost-cutting project will decrease costs by $37,000 a year. The annual depreciation on the project's fixed assets will be $2,750 and the tax rate is 21 percent. What is the amount of the change in the firm's operating cash flow resulting from this project? Multiple Choice $31,980.00 $27,05750 $29.230 50 $29.80750
You have been given the task of estimating Year 1 operating cash flow for a project with the following data. What is the operating cash flow for Year 1? Sales Revenue $13,600 Depreciation $4,000 Operating Costs $6,000 Tax Rate 35% a. $7,481 b. $7,671 c. $5,579 d. $5,896 e. $6,340
1. XYZ is considering a project with the following data: Sales Revenue = $500,000 Pre-tax Cannibalization cost = $50,000 Asset Cost = $450,000 Straight line depreciation over 3 years with zero salvage value Operating costs = $250,000 (does not include depreciation) Tax Rate 21% a. What is the after-tax cash flow? Assume a cost of capital of 10% and that the cash flows are constant for 3 years. What is the NPV? b. What is the NPV if we need...
1. XYZ is considering a project with the following data: Sales Revenue = $500,000 Pre-tax Cannibalization cost = $50,000 Asset Cost = $450,000 Straight line depreciation over 3 years with zero salvage value Operating costs = $250,000 (does not include depreciation) Tax Rate 21% a. What is the after-tax cash flow? Assume a cost of capital of 10% and that the cash flows are constant for 3 years. What is the NPV? b. What is the NPV if we need...