**Text Transcription for Educational Website:****Use the following to answer the next three questions:**The Wall, Co. is considering the purchase of some new machinery. The new machinery costs $100,000. The machinery falls into the MACRS three-year class, and it will be sold after three years for $8,000. The depreciation percentages each year are: Year 1 = 33%, Year 2 = 45%, Year 3 = 15%, Year 4 = 7%.The machinery will require The Wall to increase its working capital by $4,300, which will be recovered at the end of the machinery's life. The machinery has a three-year life and will increase The Wall's revenues by $150,000 and costs by $25,000 for each year of the project's three-year life. The Wall has a 10% cost of capital and has a 20% tax rate.**Question:**What is the operating cash flow in year 2 for the project? The image presents a list of options, each with a circle beside it, indicating they may be part of a selection or multiple-choice format. The options listed are amounts in dollars:1. $100,0002. $109,0003. $100,0004. $106,600Each dollar amount is preceded by an empty circle, suggesting the possibility of selecting one option. There are no graphs or diagrams to explain further.

Operating Cash flow is the amount which is earned by the investor from the project. It is the net…

Answered: Use the following to answer the next…

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

Problem 1PS

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