You and your freshman roommate started a company that makes T-shirts. The two of you have decided to expand and start man

purchasing new equipment. You have the following information on this investment project, what are the after-tax cash flows that in

thousands)

Cost of new machinery: $80,000

Expected life of machinery: S ycars

o Expected Salvage Value of new machinery after 5 years: $20,000

Depreciation method: straight line

Expected sales of hats: $120,000 per year

Cost of raw material: $70,000 per year

Cost of additional labor: $20,000 per year

Additional Net Working Capital required at the start of the project: $20,000

o Tax rate: 35%.

O a.-100 / 25.1 / 25.1 / 25.1 / 25.1 / 58.1

Ob,-93/25.1/25.1/25.1/25.1/58.1

O c. -100 / 25.1 / 25.1 / 25.1 / 25.1 / 38.1

O d.-100 / 9.1 /9.1 /9.1 /9.1 /38.1

O e. -80 / 14.7 / 14.7 / 14.7 / 14.7 /65.1