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Colsen Communications is trying to estimate the first-year cash flow (at Year 1 ) for a proposed project. The assets required for the project were
Colsen Communications is trying to estimate the first-year cash flow (at Year 1 ) for a proposed project. The assets required for the project were fully depreciated at the time of purchase. The financial staff has collected the following information on the project: The company has a 25% tax rate, and its WACC is 10%. Write out your answers completely. For example, 13 million should be entered as 13,000,000. a. What is the project's operating cash flow for the first year (t=1) ? Round your answer to the nearest dollar. $ b. If this project would cannibalize other projects by $0.5 million of cash flow before taxes per year, how would this change your answer to part a? Round your answer to the nearest dollar. The firm's OCF would now be $
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