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ABC Company is considering a new project. The project is expected to generate annual sales of...

ABC Company is considering a new project. The project is expected to generate annual sales of $65476, variable costs of $18689, and fixed costs of $9650. The depreciation expense each year is $10884 and the tax rate is 25 percent. What is the annual operating cash flow? Enter your answer rounded off to two decimal points. Do not enter $ or comma in the answer box. For example, if your answer is $12.345 then enter as 12.35 in the answer box.

Solutions

Expert Solution

Ans 30573.75

SALES                          65,476
LESS VARIABLE COST                          18,689
LESS FIXED COST                            9,650
LESS DEPRECIATION                          10,884
EARNING BEFORE TAX                          26,253
LESS TAX @ 25%                      6,563.25
EARNING AFTER TAX                    19,689.75
ADD DEPRECIATION                          10,884
OPERATING CASH FLOW                    30,573.75

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