Question
Sales increase by $30,000 and operating costs increase by $20,000 while depreciation decreases by $10,000. The tax rate is 30% Net Working Capital decreases by
Sales increase by $30,000 and operating costs increase by $20,000 while depreciation decreases by $10,000. The tax rate is 30% Net Working Capital decreases by $13,000 and you buy Fixed Asset of $23,000. There is a relevant before-tax externality of +$10,000.
A. | -$25,000 | |||||||||||||
B. | $1,000 | |||||||||||||
C. | $4,000 | |||||||||||||
D. | $7,000 Sales increase by $40,000 and operating costs decrease by $10,000 while depreciation increases by $20,000. The tax rate is 30% Net Working Capital decreases by $13,000 and you buy Fixed Asset of $13,000. There is a relevant before-tax externality of +$1,000.
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