A project is expected to generate annual revenues of $120,900, with variable costs of $76,000, and fixed costs of $16,500. The annual depreciation is $4,050 and the tax rate is 21 percent. What is the annual operating cash flow? Multiple Choice O O $28,400 $23,286 $46,520 $32,450 $63,020
A project is expected to generate annual revenues of $120,900, with variable costs of $76,000, and fixed costs of $16,500. The annual depreciation is $4,050 and the tax rate is 21 percent. What is the annual operating cash flow? Multiple Choice O O $28,400 $23,286 $46,520 $32,450 $63,020
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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Transcribed Image Text:A project is expected to generate annual revenues of $120,900, with variable costs of $76,000, and fixed costs of $16,500. The annual depreciation is $4,050 and the tax rate is 21
percent. What is the annual operating cash flow?
Multiple Choice
O
$28,400
$23,286
$46,520
$32,450
$63,020
Expert Solution
Step 1
Operating Cash Flow:
- It represents the amount of cash produced by the firm from its normal business operations.
- It is estimated by adding non-cash expenses to the firm's net income.
- It acts as an indicator of a firm's ability to produce sufficient positive normal cash flows.
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