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Frasier Financial has a project that will increase their revenues by $75,000 annually. This project will increase their operating costs by $10,000, however. The new

Frasier Financial has a project that will increase their revenues by $75,000 annually. This project will increase their operating costs by $10,000, however. The new project requires a new piece of equipment. The equipment will cost $20,000 and will be depreciated straight line for 5 years to an expected salvage value of $2,000. The firms marginal tax rate is 40%. What are the annual operating cash flows?

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