Question

Theresa is considering starting a small business. She plans to purchase equipment costing $147,000. Rent on the building used by the business will be $25,000 per year while other operating costs will total $31,200 per year. A market research specialist estimates that Theresa's annual sales from the business will amount to $93,000. Theresa plans to operate the business for 6 years. Disregarding the effects of taxes, what will be the amount of annual net cash flow generated by the business? Multiple Choice $36,800 $56.200 Oo oo $93,000 None of these answers is correct < Rex 6 of 8 Next >

Answer 1

Particulars	Amount (in $)
Annual Sales	$93,000
Less : Costs
Rent on the building	($25,000)
Other opearting Costs	($31,200)
Annual net cash flow	$36,800
Option (a) is correct i.e., $36,800