Your company, RMU Inc., is considering a new project whose data are shown below. What is the project's Year 1 cash flow?Sales revenues $22,250Depreciation $8,000Other operating costs $12,000Tax rate 35.0%a. $ 8,903b. $ 9,179c. $ 9,463d. $ 9,746e. $10,039

Respuesta :

Answer:

c. $ 9,463

Explanation:

operating income = sale - operating costs - depreciation

                              = $22,250 - $12,000 - $8,000

                              = $2250

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

                                 = 2250 - 2250*35% + 8000

                                 = 2250 - 787.5 + 8000

                                 = $9462.5

Therefore, The project's Year 1 cash flow is $9462.5