What is the annual operating cash flow

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A company is considering investing in a piece of machinery which will cost $550,000. It will provide an additional $160,000 in sales each year and its annual operating expenses are expected to be $52,000. The machine will be depreciated on a straight-line basis over a 10-year life with no estimated salvage value. The company has a 40% tax rate. What is the annual operating cash flow?

$64,800

$96,000

$86,800

$118,000

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Reference no: EM13777618

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