Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

An asset that was originally purchased for $879,565 is being depreciated straight-line over its useful life to zero. At the end of the project, the

An asset that was originally purchased for $879,565 is being depreciated straight-line over its useful life to zero. At the end of the project, the asset can be sold for $364,395. In addition to the operating cash flow of $801,177 in the final year of the project, net operating working capital of $90,466 will be recovered as a result of a reduction in inventory. What is the free cash flow at the end of the project? The company's tax rate is 40% and the WACC is 9%. Express your answer to the nearest dollar.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Fundamentals Of Corporate Finance

Authors: Berk, Peter DeMarzo, Jarrad Harford

3rd Global Edition

1292018402, 9781292018409

More Books

Students also viewed these Finance questions