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Tangier Enterprises is analyzing a new 6-year expansion project that requires an upfront fixed asset investment of $3.078 million. The fixed asset will be depreciated
Tangier Enterprises is analyzing a new 6-year expansion project that requires an upfront fixed asset investment of $3.078 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 $2,736,000 in annual sales, with costs of goods sold of $1,094,400. |
If the tax rate is 24 percent, what is the Operating Cash Flow (OCF) for this project? |
Multiple Choice
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$1,641,600
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$857,736
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$1,302,199
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$1,439,273
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$1,370,736
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