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Summer Tyme, Inc., is considering a new 6-year expansion project that requires an initial fixed asset investment of $2.484 million. The fixed asset will be
Summer Tyme, Inc., is considering a new 6-year expansion project that requires an initial fixed asset investment of $2.484 million. The fixed asset will be depreciated straight-line to zero over its 6 year tax life, after which time it will be worthless. The project is estimated to generate $2,208,000 in annual sales, with costs of $883,200. Required: If the tax rate is 30 percent, what is the OCF for this project? Multiple Choice $1,104,138 O O O $1,051,560 O $1,324,800 $637,560 $998,982
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