Your new employer, Freeman Software, is considering a new project whose data are shown below....
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Accounting
Your new employer, Freeman Software, is considering a new project whose data are shown below. The equipment that would be used has a 3-year tax life, and the allowed depreciation rates for such property are 33.33%, 44.45%, 14.81%, and 7.41% for Years 1 through 4. Revenues and other operating costs are expected to be constant over the project's 10-year expected life. What is the Year 1 cash flow?
| Equipment cost (depreciable basis) | $65,000 |
| Sales revenues, each year | $60,000 |
| Operating costs (excl. deprec.) | $25,000 |
| Tax rate | 25.0% |
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