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A project currently generates sales of $10.4 million, variable costs equal to 50% of sales, and fixed costs of $2.2 million. The firm's tax rate

A project currently generates sales of $10.4 million, variable costs equal to 50% of sales, and fixed costs of $2.2 million. The firm's tax rate is 30%.

a.What are the effects onthe after-tax profits and cash flow, ifsales increase from $10.4 million to $11.8 million. (amounts as positive values. do not round intermediate calculations. answer in million rounded to 3 decimal places.)

After tax profit: decreased? increased? by $____million??

Cash flowincreased? decreased? by $million.????

b.What are the effects on the after-tax profits and cash flow, ifvariable costs increase to 60% of sales.(amounts as positive values. do not round intermediate calculations. answer in million rounded to 3 decimal places.)

After-tax profitdecreased? increased? by $million???

Cash flow: increased? decreased?by $million???

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