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A firm is considering the purchase of a machine to produce tin cans, which would represent...

A firm is considering the purchase of a machine to produce tin cans, which would represent an investment of $38 million, and would be depreciated in a straight-line basis over 5 years. Sales are expected to be $17 million per year, and operating costs 49% of sales. The company is currently paying $1 million in interest per year, has a tax rate of 40%, and a WACC of 10%. What is the company’s free cash flow for year 1 of this project?

Enter your answer in millions of dollars, rounded to 2 decimals, without the dollar sign. So, if your answer is 4.5678, just enter 4.57.

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SEE THE IMAGE. ANY DOUBTS, FEEL FREE TO ASK. THUMBS UP PLEASE

jeff jeffy answered 7 months ago
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