Net cash flows for a marketing campaign Marcus Tube, a manufacturer of high-quality aluminum tubing, has maintained stable sales and profits over the past 10 years. Although the market for aluminum tubing has been expanding by 5% per year, Marcus has been unsuccessful in sharing this growth. To increase its sales, the firm is considering an aggressive marketing campaign that centers on regularly running ads in all relevant trade journals and exhibiting products at all major regional and national trade shows. The campaign is expected to require an annual tax-deductible expenditure of $152,000 over the next 5 years. Sales revenue, as shown in the income statement for 2018 LOADING... , totaled $20,800,000. If the proposed marketing campaign is not initiated, sales are expected to remain at this level in each of the next 5 years, 2019 through 2023. With the marketing campaign, sales are expected to rise to the levels shown in the table LOADING... for each of the next 5 years; cost of goods sold is expected to remain at 72% of sales; general and administrative expense (exclusive of any marketing campaign outlays) is expected to remain at 10% of sales; and annual depreciation expense is expected to remain at $490,000. Assuming a 40% tax rate, find the net cash flows over the next 5 years associated with the proposed marketing campaign.

The annual operating cash flow without the marketing campaign will be

(Round to the nearest dollar)

$.

Data Table (Click on the icon located on the top-right corner of the data table below in order to copy its contents into a spreadsheet.) Marcus Tube Income Statement for the Year Ended December 31, 2018 Sales revenue $20,800,000 Less: Cost of goods sold (72%) 14,976,000 Gross profits $5,824,000 Less: Operating expenses General and administrative expense (10%) $2,080,000 Depreciation expense 490,000 Total operating expense $2,570,000 Earnings before interest and taxes $3,254,000 Less: Taxes (40%) 1,301,600 Net operating profit after taxes $1,952,400 Print Done i Data Table (Click on the icon located on the top-right corner of the data table below in order to copy its contents into a spreadsheet.) Marcus Tube Sales Forecast Year Sales revenue 2019 $21,300,000 2020 21,800,000 2021 22,300,000 2022 23,300,000 2023 24,300,000 Print Done