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Montreal Poutine Company (MPC) will release a new range of frozen poutine which contain flavoured cheese curds. New equipment to manufacture the poutine will cost
Montreal Poutine Company (MPC) will release a new range of frozen poutine which contain flavoured cheese curds. New equipment to manufacture the poutine will cost $2 million. The new equipment falls under asset class 43 and has a capital cost allowance (CCA) rate of 30%. It is expected that the range of poutine will bring in revenues of $5 million per year for four years with production and support costs of $1.7 million per year. If MPC's marginal tax rate is 34%, what are the incremental free cash flows, in millions, in the first year of this project assuming the half year rule is in effect? Round to 2 decimal places
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