Determine what are effect on after-tax profits and cash flow

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A project currently generates sales of $10.6 million, variable costs equal to 50% of sales, and fixed costs of $2.6 million. The firm's tax rate is 35%.

What are the effects on the after-tax profits and cash flow, if sales increase from $10.6 million to $11.5 million.

What are the effects on the after-tax profits and cash flow, if variable costs increase to 60% of sales.

Reference no: EM13335678

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