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Period 0 1 2 3 4 EBIT - 35,000 45,000 60,000 75,000 The above table illustrates earnings before interest and taxes for a capital investment

Period

0 1 2 3 4
EBIT - 35,000 45,000 60,000 75,000

The above table illustrates earnings before interest and taxes for a capital investment project. Additional information for this project:

- initial cost of the investment = $250,000

- change in net working capital = $10,000 (and 50% of this is recoverable at end of the project)

- tax rate = 31.0%

- WACC = 15.0%

- depreciation = straight line over five years

- projected cash flow from salvage = $136,250

What is operating cash flow for Year 2?

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