1) Assume a corporation has earnings before depreciation and taxes of $100,000, depreciation of $25,000, and that it has a 25 percent tax bracket. What are the after-tax cash flows for the company?

3) Price Corp. is considering selling to a group of new customers and creating new annual sales of $320,000. 3% will be uncollectible. The collection cost on these accounts is 4% of new sales, the cost of producing and selling is 79% of sales and the firm is in the 26% tax bracket. What is the profit on new sales?