you have been asked by the president of your company to evaluate the proposed acquisition of a new special purpose truck for $70,000. The Truck falls into the MACRS three-year class, and it will be...


you have been asked by the president of your company to evaluate the proposed acquisition of a new special purpose truck for $70,000. The Truck falls into the MACRS three-year class, and it will be sold after 3 years for $5,000.  Use of the truck will require an increase in NWC of $10,000.  The truck will have no effect on revenues, but it is expected to save the firm $32,000 per year in before-tax operating costs, mainly labour. The firm's marginal tax rate is 40 percent. What will the operating cashflow for this project be during year 2?



Jun 05, 2022
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