A firm is introducing a new product and expected change in net operating income of SAR 15000,000. Its corporate tax is 23%. The project will also produce SAR 4,000,000 depreciation per year. In addition, this cause the following changes:

Problem 12-4: Calculating the free cash flows A firm is introducing a new product and expected change in net operating income of SAR 15000,000. Its corporate tax is 23%. The project will also produce SAR 4,000,000 depreciation per year. In addition, this cause the following changes: Data Without Project With Project Accounts Receivable 375,000 550,000 Inventory 425,000 575,000 Accounts Payable 650,000 825,000 Change in EBIT 15,000,000 Tax rate 23% Depreciation 4,000,000