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Winter Tyme, Inc., is considering building a plant to produce snow tires. The project would last 5 years and requires an initial fixed asset investment

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Winter Tyme, Inc., is considering building a plant to produce snow tires. The project would last 5 years and requires an initial fixed asset investment of $5.508 million. The fixed asset will be depreciated straight-line to zero over its 5 -year tax life, after which time it will be worthless. Winter Tyme paid $75,000 for a market analysis which indicates the project will generate $4,896,000 in annual sales, with costs of $1,958,400. Required: If the tax rate is 34 percent, what is the OCF for this project? $1,211,760 $2,937,600 $2,197,692 $2,313,360 $2,429,028

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