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As assistant to the CFO of Boulder Inc., you must estimate the Year 1 cash flow for a project with the following data. What is the Year 1 cash flow?Sales revenues $13,000Depreciation $4,000Other operating
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As assistant to the CFO of Boulder Inc., you must estimate the Year 1 cash flow for a project with the following data. What is the Year 1 cash flow?Sales revenues $13,000Depreciation $4,000Other operating costs $6,000Tax rate 35.0%a. $5,950b. $6,099c. $6,251d. $6,407e. $6,568

User Get
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Answer:

a. $5,950

Step-by-step explanation:

operating income = sale - operating costs - depreciation

= $13,000 - $6,000 - $4,000

= $3000

cash flow for year 1 = operating income - tax + depreciation

= 3000 - 3000*35% + 4000

= 3000 - 1050 + 4000

= $5950

Therefore, The project's Year 1 cash flow is $5950.

User Knightpfhor
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