=+ST41 Depreciation and cash flow A firm expects to have earnings before interest and taxes (EBIT) of
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=+ST4–1 Depreciation and cash flow A firm expects to have earnings before interest and taxes
(EBIT) of $160,000 in each of the next 6 years. It pays annual interest of $15,000. The firm is considering the purchase of an asset that costs $140,000, requires $10,000 in installation cost, and has a recovery period of 5 years. It will be the firm’s only asset, and the asset’s depreciation is already reflected in its EBIT estimates.
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Related Book For 
Principles Of Managerial Finance
ISBN: 9781292261515
15th Global Edition
Authors: Chad J. Zutter, Scott Smart
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