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A company considers a project that will generate cash sales of $50,000 per year. Fixed costs (other than depreciation) will be $10,000 per year, variable
A company considers a project that will generate cash sales of $50,000 per year. Fixed costs (other than depreciation) will be $10,000 per year, variable costs will be 40% of sales, and depreciation of the equipment in the project will be $5,000 per year. Taxes are 40%. The expected annual cash ow to the company resulting from the project is A. $15,000 B. $9,000 C. $19,000 D. $14,000
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