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Island Foods is considering a banana project and has developed the following estimates: unit sales = 15,000 boxes or units, price per box (unit) =
Island Foods is considering a banana project and has developed the following estimates: unit sales = 15,000 boxes or units, price per box (unit) = $175, variable cost per unit = $100, annual fixed costs = $33,699. Annual depreciation using straight line over 6 years is $14,000 and the tax rate is 21 percent. What effect would a decrease of 9% in the unit sales have on the operating cash flow? Pay attention to sign of cash flow (positive vs. negative).
Group of answer choices
-$62,212.50
-$51,187.50
$67,212.50
-$79,987.50
$51,187.50
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