What is the ocf for this project

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Summer Tyme, Inc., is considering a new 3-year expansion project that requires an initial fixed asset investment of $3.726 million. The fixed asset will be depreciated straight-line to zero over its 3-year tax life, after which time it will be worthless. The project is estimated to generate $3,312,000 in annual sales, with costs of $1,324,800.

Required:

If the tax rate is 31 percent, what is the OCF for this project?

 

Reference no: EM13266284

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