Year 1	Year 2
Revenues	126.1126.1	155.6155.6
COGS and Operating Expenses (other than depreciation)	36.236.2	57.157.1
Depreciation	28.128.1	39.139.1
Increase in Net Working Capital	2.32.3	8.68.6
Capital Expenditures	28.528.5	37.637.6
Marginal Corporate Tax Rate	3535%	3535%

a. What are the incremental earnings for this project for years 1 and 2? (Note: Assume any incremental cost of goods sold is included as part of operating expenses.)

b. What are the free cash flows for this project for years 1 and 2?

a. What are the incremental earnings for this project for years 1 and 2? (Note: Assume any incremental cost of goods sold is included as part of operating expenses.)

Calculate the incremental earnings of this project below:(Round to one decimal place.)

Incremental Earnings Forecast (millions)		Year 1
Sales	$
Operating Expenses	$
Depreciation	$
EBIT	$
Income tax at 35%	$
Unlevered Net Income	$