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Libby just expanded her restaurant. She projects revenue will reach $35,000 for the new restaurant in the first year and increase by 25% in each
Libby just expanded her restaurant. She projects revenue will reach $35,000 for the new restaurant in the first year and increase by 25% in each of next three years. Expenses (not including depreciation) are 75% of sales. The initial cost of the new restaurant expansion is $40,000 (depreciable over 7 years using MACRS) and her tax rate is 21%. What are annual cash flows for the first year?
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