Johnson Communications is trying to estimate the Year 1 operating cash flow for a proposed project. The assets required for the project were fully depreciated at the time of purchase. The financial staff has collected the following information:

Sales revenues	$8.8 million
Operating costs	4.8 million
Interest expense	1.1 million

Johnson has also determined that this project would cannibalize one of its other projects by $1.4 million of cash flow (before taxes) per year. The firm has a 30 percent tax rate, and its WACC is 10 percent. Calculate the projects operating cash flow for Year 1.

	a.	$1,820,000
	b.	$2,030,000
	c.	$1,050,000
	d.	$40,000
	e.	$2,800,000