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ABC Corporation has hired you to evaluate a new FOUR year project for the firm. The project will require the purchase of a $ 8

ABC Corporation has hired you to evaluate a new FOUR year project for the firm. The project will require the purchase of
a $830,600.00 work cell. Further, it will cost the firm $58,500.00 to get the work cell delivered and installed. The work cell
will be straight-line depreciated to zero with a 20-year useful life. The project will require new employees to be trained at
a cost of $74,300.00. The project will also use a piece of equipment the firm already owns. The equipment has been fully
depreciated, but has a market value of $5,500.00. Finally, the firm will invest $11,400.00 in net working capital to ensure
the project has sufficient resources to be successful.
The project will generate annual sales of $903,000.00 with expenses estimated at 36.00% of sales. Net working capital
will be held constant throughout the project. The tax rate is 39.00%.
The work cell is estimated to have a market value of $490,000.00 at the end of the fourth year. The firm expects to
reclaim 89.00% of the final NWC position.
The cost of capital is 11.00%.
What is the yearly operating cash flow for the project?
Answer format: Currency: Round to: 2 decimal places.
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