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 eamings 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 27 (Note: Assume any incremental cost of goods sold is included as part of operating expenses) Calculate the incremental eamings of this project below: (Round to one decimal place) Incremental Earnings Forecast (millions) Sales Year 1 $ Operating Expenses Depreciation EBIT Income tax at 21% $ $ $ $ $ Unlevered Net Income Year 2 Data table (Click on the following icon in order to copy its contents into a spreadsheet.) Revenues Operating Expenses (other than depreciation) Depreciation Increase in Net Working Capital example Capital Expenditures Marginal Corporate Tax Rate Year 1 Year 2 128.6 155.5 45.6 53.0 22.1 26.2 21 7.6 31.9 44.5 21% 21% Clear all Check answer