Donata Company purchased equipment for $31,000 in December 20x1. The equipment is expected to generate $11,000 per year of additional revenue and incur $3,000 per year of additional cash expenses, beginning in 20x2. Under MACRS, depreciation in 20x2 will be $4,000. If the firm's income tax rate is 30%, the after-tax cash flow in 20x2 would be: rev: 04-16-2011

Multiple Choice

$2,400.

$3,000.

$4,200.

$6,800.

None of the answers is correct.