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Stroms Drive-In is considering replacing its old projector with a new one. The old projector was being depreciated using MACRS (5 year class). Original installed
Stroms Drive-In is considering replacing its old projector with a new one. The old projector was being depreciated using MACRS (5 year class). Original installed cost was $10,000 four years ago and it can now be sold for $2,000. The new projector will cost $18,000 and will be depreciated using MACRS (5 year class). Reduced expenses of $5,000 per year will result because of decreased labor cost to run the projector. The firm is in the 21% tax bracket. What is the operating cash flow for year 4?
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