Depreciation tax shield approach

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Reference no: EM131311469

A new project will generate sales of $74.5 million, costs of $42.5 million, and depreciation expense of $10.5 million in the coming year. The firm's tax rate is 30%. Calculate cash flow for the year by using all three methods: (I) adjusted accounting profits; (II) cash inflow/cash outflow analysis; and (III) the depreciation tax shield approach.

I) CF =

II) CF =

III) CF =

Reference no: EM131311469

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