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E Untitled document - Google Docs X LO2 5 Calculating Depreciation A X 71SKkVY2obgWY-gY-aPmM8pe2E35LN8/edit All changes saved in Drive ip - BIUA 12 H. Cochran,
E Untitled document - Google Docs X LO2 5 Calculating Depreciation A X 71SKkVY2obgWY-gY-aPmM8pe2E35LN8/edit All changes saved in Drive ip - BIUA 12 H. Cochran, Inc., is considering a new three-year Calculating Project OCF expansion project that requires an initial fixed asset investment of $2.15 million. The fixed asset will be depreciated straight-line to zero over its three-year tax life, after which time it will be worthless. The project is estimated to generate $2.23 million in annual sales, with costs of $1.25 million. If the tax rate is 23 percent, what is the OCF for this project? 10. Calculating Project NPV In the previous problem, suppose the required return on the project is 14 percent. What is the project's NPV? DELL
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