Question
Kolbys Korndogs is looking at a new sausage system with an installed cost of $522,000. This cost will be depreciated straight-line to zero over the
Kolbys Korndogs is looking at a new sausage system with an installed cost of $522,000. This cost will be depreciated straight-line to zero over the projects four-year life, at the end of which the sausage system can be scrapped for $106,000. The sausage system will save the firm $194,000 per year in pretax operating costs, and the system requires an initial investment in net working capital of $52,000. What is the aftertax salvage value of the equipment? (Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32.) Aftertax salvage value $ What is the annual operating cash flow? (Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32.) OCF $
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