Neutsch Co. is trying to estimate the first-year net cash flow (at Year 1) for a proposed project. The financial staff has collected the following information on the project: Sales revenues $11,000 Operating costs (excluding depreciation) $7,000 Depreciation $2,000 Interest expense $2,000 The company has a 45% tax rate, and its WACC is 12%. ANSWER IN NUMERICAL VALUE ONLY (NO $ SIGNS, COMMAS, ETC.). ONLY PUT POSITIVE VALUES IN ANSWERS FOR PV OR FV (without the minus sign) ROUND TO TWO DECIMAL PLACES

a. What is the projects net cash flow for the first year (t = 1)?

b. If this project would cannibalize other projects by $1300 of cash flow before taxes per year, how would this change your answer to Part a?

c. Ignore Part b. If the tax rate dropped to 36%, how would that change your answer to Part a?