Clinton Carbide, Inc., is considering a new three-year expansion project that requires an initial fixed asset investment

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Clinton Carbide, Inc., is considering a new three-year expansion project that requires an initial fixed asset investment of \($1.8\) 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 \($1,850,000\) in annual sales, with costs of \($650,000.\) If the tax rate is 35 percent, what is the OCF for this project?

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Fundamentals Of Corporate Finance

ISBN: 9780072313000

5th Edition

Authors: Stephen A Ross, Randolph W Westerfield

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