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Operating cash flow (growing each year; MACRS). Mathews Mining Company is looking at a project that has the following forecasted sales: first-year sales are 6,500
Operating cash flow (growing each year; MACRS). Mathews Mining Company is looking at a project that has the following forecasted sales: first-year sales are 6,500 units, and sales will grow at 11% over the next four years (a five-year project). The price of the product will start at $124 per unit and will increase each year at 6%. The production costs are expected to be 59% of the current year's sales price. The manufacturing equipment to aid this project will have a total cost (including installation) of $1,400,000. It will be depreciated using MACRS., and has a seven-year MACRS life classification. Fixed costs will be $48,000 per year. Mathews Mining has a tax rate of 28%. What is the operating cash flow for this project over these five years? What is the operating cash flow for this project in year 17 $ (Round to the nearest dollar.) Data table MACRS Fixed Annual Expense Percentages by Recovery Class Click on this icon to download the data from this table Year 1 2 3 4 5 6 7 8 9 10 11 3-Year 33.33% 44.45% 14.81% 7.41% 5-Year 20.00% 32.00% 19.20% 11.52% 11.52% 5.76% Print 7-Year 14.29% 24.49% 17.49% 12.49 % 8.93% 8.93% 8.93% 4.45% Done 10-Year 10.00 % 18.00% 14.40 % 11.52% 9.22% 7.37% 6.55% 6.55% - X 6.55% 6.55% 3.28%
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