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The Hydraulic Machine required by Colaba is priced at $301,000 and is depreciated straight-line over its life of 9-year. Colaba has yearly sales of 8,700
The Hydraulic Machine required by Colaba is priced at $301,000 and is depreciated straight-line over its life of 9-year. Colaba has yearly sales of 8,700 units which are priced at $74 per unit; fixed costs of $180,000 each year and variable costs of $45 per unit. How sensitive is the operating cash flow to a $1 change in the per unit sales price? Assume a tax rate is 35 percent.
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