The president of real time inc has asked you to evaluate the proposed acquisition of a new computer. The computer's price is $40,000 and it falls into the MACRS 3-year class. Purchase of the computer would require an increase in net operating working capital of $5,000. The computer would increase the firm's before-tax revenues by $20,000 per year but would also increase operating costs by $5,000 per year. The computer is expected to be used for 3 years and then sold for $30,000. The firm's marginal tax rate is 40%, and the project's cost of capital is 14%

Refer to Real Time, Inc. What is the operating cash flow in Year 2

A. $9,000

B. $10,240

C. $11,687

D. $13,453

E. $16,200