What is the operating cash flow

Assignment Help Business Economics
Reference no: EM131197640

ABC has a proposed project which will generate sales of 182 units at a selling price of $351 each. The fixed costs are $20,028 and the variable costs per unit are $79. The project requires $176,917 of machinery which will be depreciated on a straight-line basis over the 5-year life of the project. That is, depreciation each year is $176,917/5.The tax rate is 27%. What is the operating cash flow?

Reference no: EM131197640

Questions Cloud

Project has an annual operating cash flow : A project has an annual operating cash flow of $15,403. Initially, this 4-year project required $2,271 in net working capital, which is recoverable when the project ends. The firm also spent $10,000 on equipment to start the project. This equipment w..
Preferred stock is defined as equity with priority : Preferred stock is defined as equity with priority over common stock with respect to the payment of dividends and the distribution of assets in a liquidation. Preferred stock is a hybrid security which shares features with both common stock and debt...
Utilization of cash flow analysis is setting bid price : Another utilization of cash flow analysis is setting the bid price on a project. To calculate the bid price, we set the project NPV equal to zero and find the required price. Thus the bid price represents a financial break-even level for the project...
Expansion project-what is project initial investment outlay : ABC Corporation is considering an expansion project. The necessary equipment could be purchased for $22,551 and shipping and installation costs are another $1,581. The project will also require an initial $7,784 investment in net working capital. The..
What is the operating cash flow : ABC has a proposed project which will generate sales of 182 units at a selling price of $351 each. The fixed costs are $20,028 and the variable costs per unit are $79. The project requires $176,917 of machinery which will be depreciated on a straight..
What is the NPV of the decision to purchase the old machine : A firm is considering an investment in a new machine with a price of $18 million to replace its existing machine. The current machine has a book value of $6 million and a market value of $4.5 million. The new machine is expected to have a four-year l..
Identify potential barriers to effective team : There are several variables that combine to establish a successful, sustainable team. Identifying the key components becomes especially challenging when the members are operating virtually. Identify potential barriers to an effective team and options..
Cash flow to creditors-stockholders-calculating cash flows : Cash Flow to Creditors The 2014 balance sheet of Jordan’s Golf Shop, Inc., showed long-term debt of $1 .625 million, and the 2o15 balance sheet showed long-term debt of $1.73 million. The 2015 income statement showed an interest expense of $185.000. ..
Calculate the npv for both conveyor belt systems : BOE Manufacturing is trying to decide between two different conveyor belt systems. System A costs $220,000, has a four-year life, and requires $70,000 in pretax annual operating costs. System B costs $312,000, has a six-year life, and requires $64,00..

Reviews

Write a Review

Business Economics Questions & Answers

  “highly achievable budget targets reduce risk of gameplaying

“Highly achievable budget targets reduce the risk of gameplaying. The stakes associated with budget achievement in most firms, which include bonuses, promotions, and job security, are so significant that managers who are in danger of failing to achie..

  If firms are successful in product differentiation

If firms are successful in product differentiation

  Economies of scale more important

Answer the same questions as in the previous problem if TC = .5m + 10Q. In which problem are economies of scale more important? Explain how this affects your outsourcing decision.

  Price discriminates will charge deidre higher price

Erin and Deidre, two residents of Ithaca, New York, are planning a trip to Boston. Erin, the sales manager for a large retailer, has to attend a business meeting. Deidre, a college student on vacation, is planning a leisurely trip to visit friends an..

  What might cause prices to change in the marketplace

Have you ever noticed that prices changes from time to time for seemingly no reason? Well, believe it or not, there is most definitely a reason. Businesses try to extract as much money as possible from consumers for their products. What are some of t..

  Short-run production process

Is it true that in a short-run production process, the marginal cost curve eventually slopes upward because firms have to pay workers a higher wage rate as they produce more output?

  What is difference in framework convention-protocol

What is the difference between framework convention and a protocol? What are the advantages and disadvantages to a two-stage approach to negotians? Why do most negotiations for globl environmental regimes end up taking a two-stage approach?

  What is peru opportunity cost of producing banana

Consider two countries, Peru and Brazil, who produce coffee and bananas. Brazil and Peru's hourly productivity are as follows: What is Peru’s opportunity cost of producing a banana? What is Brazil’s. Who has the absolute advantage in coffee productio..

  Equipment for businesses-require high-quality audio systems

At the beginning of the year, an audio engineer quit his job and gave up a salary of $175,000 per year in order to start his own business, Sound Devices, Inc. The new company builds, installs, and maintains custom audio equipment for businesses that ..

  Discussed how racial segregation concentrates economic

We discussed how racial segregation concentrates economic, social, and cultural capital in white communities. This disparity creates dissimilar opportunity structures that distinguish racial groups according to potential life course trajectories.

  Decided to purchase house

John Cardinals has decided to purchase a house in Moncks Corner, SC. The price of the house is $ 80000 after a down payment of $ 20000. The Bank of America will finance the purchase for 25 years at 9%. Advise about which choice he should take and the..

  Explain how the short-run phillips curve the long-run

explain how the short-run phillips curve the long-run phillips curve the short-run aggregate supply curve the long-run

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd