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ABC, Inc is planning the purchase of new equipment that costs $149,331. The project is expected...

ABC, Inc is planning the purchase of new equipment that costs $149,331. The project is expected to last for 14 years. Each year, the new project is expected to sell 103 units for $480 per unit. The variable costs are expected to $50 per unit and the fixed costs are expected to be $23,038. The equipment will be depreciated on a straight-line basis over the 14-year life of the project. That is, the depreciation each year will be $149,331/14. Assuming a tax rate of 23%, what is the operating cash flow?

NEED EXCEL formula too

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Expert Solution

Hi dear, I have calculated OCF in 2methods side by side with the excel formula and explanation on depreciation has also been attached. You can refer any method which onle you like. You need to take a look on depreciation matter only that is bit complex and else everything is ok. please have a look and if you really like the answer you can appreciate me by giving a like. please do not forget to like. thank you


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