Elmdale Enterprises is deciding whether to expand its production facilities. Although long-term cash flows are difficult to estimate, management has projected the following cash flows for the first two years (in millions of dollars): - a. What are the incremental earnings for this project for years 1 and 2? (Note: Assume any incremental cost of goods sold is included as part of operating expenses.) b. What are the free cash flows for this project for years 1 and 2? a. What are the incremental earnings for this project for years 1 and 2? (Note: Assume any incremental cost of goods sold is included as part of operating expenses.) Calculate the incremental earnings of this project below: (Round to one decimal place.) Incremental Earnings Forecast (millions) Year 1 Year 2 Sales $ Operating Expenses Depreciation $ $ $ $ $ $ $ $ EBIT Income tax at 21% $ Unlevered Net Income FA $ (Click on the following icon in order to copy its contents into a spreadsheet.) Year 1 Year 2 Revenues Operating Expenses (other than depreciation) Depreciation Increase in Net Working Capital Capital Expenditures Marginal Corporate Tax Rate 123.2 41.3 25.8 2.5 26.5 21 % 150.7 51.7 27.7 7.6 44.2 21 %