Cochrane, Inc., is considering a new three-year expansion project that requires an initial fixed asset investment of
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Cochrane, Inc., is considering a new three-year expansion project that requires an initial fixed asset investment of $2.7 million. The fixed 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 $2,450,000 in annual sales, with costs of $1,180,000. If the tax rate is 35 percent, what is the OCF for this project?
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Using the tax shield approach to calculating OCF Reme...View the full answer
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Related Book For 
Essentials Of Corporate Finance
ISBN: 9780073405131
6th Edition
Authors: Stephen A. Ross, Randolph Westerfield, Bradford D. Jordan
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