Hubrey Home Inc. is considering a new three-year expansion project that requires an initial fixed asset investment of $3.6 million. The fixed asset falls into Class 10 for tax purposes (CCA rate of 30% per year), and at the end of the three years can b sold for a salvage value equal to its UCC. The project is estimated to generate $2,620,000 in annual sales, with costs of $829,000. If the tax rate is 35%, what is the OCF for each year of this project? (Enter the answers in dollars. Do not round your intermediate calculations. Round the final answers to 2 decimal places. Omit $ sign in your response.) OCF1 OCF2 0CF3 $ 1353.15 $ 1485.45 $2888.47
Hubrey Home Inc. is considering a new three-year expansion project that requires an initial fixed asset investment of $3.6 million. The fixed asset falls into Class 10 for tax purposes (CCA rate of 30% per year), and at the end of the three years can b sold for a salvage value equal to its UCC. The project is estimated to generate $2,620,000 in annual sales, with costs of $829,000. If the tax rate is 35%, what is the OCF for each year of this project? (Enter the answers in dollars. Do not round your intermediate calculations. Round the final answers to 2 decimal places. Omit $ sign in your response.) OCF1 OCF2 0CF3 $ 1353.15 $ 1485.45 $2888.47
Chapter11: Capital Budgeting Decisions
Section: Chapter Questions
Problem 2PB: Markoff Products is considering two competing projects, but only one will be selected. Project A...
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