NC is trying to estimate the first-year operating cash flow for a proposed project. The...
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NC is trying to estimate the first-year operating cash flow for a proposed project. The financial staff has collected the following information:
Proposed sales
$10 million
Operating costs (not including depreciation)
$7 million
Depreciation tax shield
$0.2 million
Interest expense
$1.5 million
The corporate tax rate is 40%. What is the projects operating cash flow for the first year (t = 1)?
Select one:
a. $2,000,000
b. $1,880,000
c. $1,100,000
d. Neither of the above
NC is trying to estimate the first-year operating cash flow for a proposed project. The financial staff has collected the following information:
Proposed sales
$10 million
Operating costs (not including depreciation)
$7 million
Depreciation tax shield
$0.2 million
Interest expense
$1.5 million
The corporate tax rate is 40%. What is the projects operating cash flow for the first year (t = 1)?
Select one:
a. $2,000,000
b. $1,880,000
c. $1,100,000
d. Neither of the above
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