Pepper's Pizza is considering adding an additional pizza oven to help meet their increased carryout and delivery demand. The oven would cost $20,000 and require a $500 increase in net operating working capital which will be recovered at the end of the life of the oven.. The oven has a 3-year expected life and falls into the 3-year MACRS depreciation class with the following annual depreciation percentages:

• yr 1: 33%
• yr 2 45%
• yr 3 15%
• yr 4: 7%

The new oven would increase annual revenues by $20,000 and increased annual operating costs will be 40% of increased revenues. The company's tax rate is 30%. The oven would have a salvage value of $1000 at the end of its 3-year life.

What is the year 2 operating cash flow for this project?

Answers:	A. 2,100
	B. 10,000
	C. 8,400
	D. 11,100