What is the operating cash flow for year 4 of the Eugene project that OreDuck should use in its NPV analysis of the project? The tax rate is 19.0 4, the Eugene project is expected to have relevant revenue of $77,000, relevant variable costs of $26,000, and relevant depreciation of $15,000. In additi OreDuck would have one source of fixed costs associated with the Eugene project. Yesterday, OreDuck signed a deal with State Beaver Advertising to de a marketing campaign. The terms of the deal require OreDuck to pay State Beaver Advertising either $17000.00 in 4 years if the Eugene project is pursu $21000.00 in 4 years if the Eugene project is not pursued. Finally, the equipment purchased for the project would be sold in 4 years for an expected afte cash flow of $8,000. $47,400.00 (plus or minus $10) $30,390.00 (plus or minus $10) $69,170.00 (plus or minus $10) $55,400.00 (plus or minus $10) None of the above is within $10 of the correct answer
What is the operating cash flow for year 4 of the Eugene project that OreDuck should use in its NPV analysis of the project? The tax rate is 19.0 4, the Eugene project is expected to have relevant revenue of $77,000, relevant variable costs of $26,000, and relevant depreciation of $15,000. In additi OreDuck would have one source of fixed costs associated with the Eugene project. Yesterday, OreDuck signed a deal with State Beaver Advertising to de a marketing campaign. The terms of the deal require OreDuck to pay State Beaver Advertising either $17000.00 in 4 years if the Eugene project is pursu $21000.00 in 4 years if the Eugene project is not pursued. Finally, the equipment purchased for the project would be sold in 4 years for an expected afte cash flow of $8,000. $47,400.00 (plus or minus $10) $30,390.00 (plus or minus $10) $69,170.00 (plus or minus $10) $55,400.00 (plus or minus $10) None of the above is within $10 of the correct answer
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter19: Capital Investment
Section: Chapter Questions
Problem 10E: Roberts Company is considering an investment in equipment that is capable of producing more...
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