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PERIOD 0 1 2 3 4 EBIT $46000 $57000 $70000 $80000 The above table illustrates earnings before interest and taxes for a capital investment project.
PERIOD | 0 | 1 | 2 | 3 | 4 |
EBIT | $46000 | $57000 | $70000 | $80000 |
The above table illustrates earnings before interest and taxes for a capital investment project. Additional information for this project:
- initial cost of the investment = $600,000
- no change in net working capital
- tax rate = 32.0%
- depreciation = accelerated using the MACRS factors: 0.33330, 0.44450, 0.1481, 0.0741
- projected cash flow from salvage = $0
- projected erosion costs = $30,000 in Year 1 and $40,000 in Year 2
What is projected operating cash flow for Year 4?
What is the projected depreciation for Year 3?
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