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Blaze Scooters is considering expanding into a new college town and has the following operating data: Initial Investment in scooters (Year O): $104167 Cost of

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Blaze Scooters is considering expanding into a new college town and has the following operating data: Initial Investment in scooters (Year O): $104167 Cost of securing permits (assume that permit cost is a tax-deductible expense in year 1): $8932 Anticipated Revenue: $193346 for years 1-5. Depreciation of scooters - straight line down to 0 over 5 years. Operating expenses (not including Depreciation): $77410 per year. Tax Rate: 18% Net Working Capital, consisting of cash, spare parts inventory, accounts receivable, and accounts payable: $30,000. Blaze expects to be able to recoup 100% of Net Working if they shut down. Assume that investment in working capital occurs in year 0 at the start of the project Scrap value of scooters at the end of 5 years: $20,000. (remember that any capital gains when selling are taxable) Assume that Blaze makes the necessary investments, operates for 5 years, and then shuts down, selling the scooters for scrap and recouping Net Working Capital. What are their expected after-tax cash flows for year 2 rounded to the nearest cent (01)? QUESTION 2 Blaze Scooters is considering expanding into a new college town and has the following operating data: Initial Investment in scooters (year O): S108052 Cost of securing permits (assume that permit cost is a tax-deductible expense in year 1): $14585 Anticipated Revenue: $197063 for years 1-5. Depreciation of scooters - straight line down to over 5 years. Operating expenses (not including Depreciation): $84798 per year, Tax Rate: 17% Net Working Capital, consisting of cash, spare parts inventory, accounts receivable, and accounts payable: $26840. Blaze expects to be able to recoup 100% of Net Working if they shut down. Assume that investment in working capital occurs in year o at the start of the project Scrap value of scooters at the end of 5 years: $23822. (remember that any capital gains when selling are taxablo) Assume that Blaze makes the necessary investments, operates for 5 years, and then shuts down, selling the scooters for scrap and recouping Net Working Capital. What are their expected after-tax cash flows for year 5 rounded to the nearest cent (01)

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