You know that you should calculate the estimated Free Cash Flow for the new project using: Free Cash Flow = (Revenues Costs Depreciation) =r (1 Tc) + Depreciation CapEx . Net Working Capital! In your discussion with Jane, you have agreed that for your analysis you should assume that the profitability of the new project would be similar to IBM's existing projects in 2017 and estimate (revenues costs) each year by using the 2017 EBITDA / Sales profit margin