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Tinney & Smyth Inc. is considering the purchase of a new batch polymer - bonding machine for producing Crazy Rubber, a children s toy. The
Tinney & Smyth Inc. is considering the purchase of a new batch polymerbonding machine for producing Crazy Rubber, a childrens toy. The machine will increase EBITDA by $ per year for the next two years. The machines purchase price is $ and the salvage value at the end of two years is $ To run the Crazy Rubber production line, the company will need to purchase an inventory of polydimethylsiloxane and boric acid for a total cost of $ The tax rate is What are the operating cash flows in Year Assume that the cost of buying the new machine is tax deductible at the end of the first year. Round to the nearest dollar.
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