Ernie's Electrical is evaluating a project which will increase sales by $50,000 and costs by $30,000. The project will cost $150,000 and be depreciated straight-line to a zero book value over the 10 year life of the project. The applicable tax rate is 34 percent. What is the operating cash flow for this project?© BrainMass Inc. brainmass.com June 3, 2020, 9:09 pm ad1c9bdddf
Depreciation expense = 150,000/10 years = 15,000 per year
Sales increase 50,000
Less costs ...
This solution is comprised of a list of figures necessary to compute the operating cash flow for Ernie's Electrical.