Given the desire to cut carbon emissions, Ford is considering introducing a new production line of electric sedans. The expected annual unit sales of the electric cars is 34,000 ; and the selling price is $26,000 per car. Variable costs of production are $9,000 per car. The fixed overhead, including salary of top executives is $80 million per year. However, the introduction of the electric sedans will decrease Ford's sales of regular sedan by 10,000 cars per year; the regular sedans have a unit price of $20,000, a unit variable cost of $12,000, and fixed costs of $250,000 per year. Depreciation costs of the new production line are $45,000 per year. The marginal tax rate is 29 percent. What is the incremental annual cash flow from operations? Incremental annual cash flow from operations $ eTextbook and Media
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