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Scholastic Co. is evaluating a machine with an initial cost of $300,000 and a five-year life that costs $75,000 per year to operate. The uses
Scholastic Co. is evaluating a machine with an initial cost of $300,000 and a five-year life that costs $75,000 per year to operate. The uses straight-line depreciation, and the applicable discount rate is 8%. The machine will have a salvage value of $70,000 at the end o project's life. The firm has a tax rate of 21%.
Calculate
the operating cash flow in year 1.
NPV of the project
EAC of the project
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