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a)what will the free cash flow for year 0 be? b)what will the free cash flow be for year- 1-5? Daily Enterprises is purchasing a
a)what will the free cash flow for year 0 be?
Daily Enterprises is purchasing a $9.8 million machine. It will cost $53,000 to transport and install the machine. The machine has a depreciable life of five years using straight-line depreciation and will have no salvage value. The machin will generate incremental revenues of $4.1 million per year along with incremental costs of $1.2 million per year. Daily's marginal tax rate is 21%. You are forecasting incremental free cash flows for Daily Enterprises. What are the incremente free cash flows associated with the new machine b)what will the free cash flow be for year- 1-5?
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