What is the free cash flow from the project in year one

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A new project is expected to generate $800,000 in revenues, $250,000 in cash operating expenses, and depreciation expense of $150,000 in each year of its 10-year life. The corporation’s tax rate is 35%. The project will require an increase in net working capital of $85,000 in year one and a decrease in net working capital of $75,000 in year ten. What is the free cash flow from the project in year one?

a. $410,000

b. $375,000

c. $380,000

d. $298,000

Reference no: EM13877903

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