Calculate the incremental annual after-tax free cash flow

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Case: You are considering opening another restaurant in the Pizza chain. The new restaurant will have annual revenue of $200,000 and operating expenses of $80,000. Th e annual depreciation and amortization for the assets used in the restaurant will equal $20,000. An annual capital expenditure of $10,000 will be required to offset wear and tear on the assets used in the restaurant, but no additions to working capital will be required. The marginal tax rate will be 30 percent. Calculate the incremental annual after-tax free cash flow for the project.

Reference no: EM133290552

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