Foundations Of Financial Aerocomp, Inc. Figure2 Financial analysisofP ect Diversify into copy machines Year 4 Year 2 Years 2.6 aso 339,938 Requi Net Of new franchise... Additional Additional ovvrating costs Amonization.. Net in incurve Less: Tax at 33%_. . Incaease in aftertax incryne . Add back depreciation........... Net change in cash flow Initial $7(xn000 26,250 43,750 _AQ8 s 17,500 46 , 26,250 131.250 s 17500 105,438 S262.500 26,250 __LLS(" 218,750 164,063 S393,750 26,250 11.5m 350000 252 MI) Figure 3 Financial analysis of Project C: Add a helicopter to the company's fleet Nel cost of Additional revenue.... Additional operating costs....., Depreciation Net increase in income Tax at 33%.. Increase in aftertax income Add hack depteciation Net change in cash flow . Year I Expenditures $800,000 3100.000 40,000 _uoooo (60,000) $120,000 60.000 Year 2 40,000 _12LQm (16,000) s 176,000 160,000 Year3 $300,000 40.000 92,000 $168,000 229,640 Figure 4 Financial analysis of Project D: Add fleet of trucks Initial Nel cost Of new trucks Additional revenue.... . Additional opemlingcosts...... Depreciation Net in income Less: Tax at Increase in aftenax income Add tuk Nel changc in cash flow _ Year 19,125 286,875 268,706 $325,125 19,12S -112200 193,800 $112,200 242.046 3 $ 89,250 255(1) (43,350) $107,111) 63,750 Year 4 $450,000 40,000 242000 330,140 Year 4 s 76,500 31,875 (62,475) 107.100 44625 Year s $6m,tm 392,0 43(1640 Y,ur5 s 51,0 38250 $107,100 12,750 McGraw-Hill Education. rights reserved. No reproduction or distribution Without the prior written