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What is the incremental operating cash flow after tax

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Reference no: EM132645390

A piece of machinery costs $20,000 and is expected to have a four year useful life for the firm. The machine is to be depreciated for tax purposes at 12.5 percent per year on a straight line basis. The firm's cash operating costs are expected to decrease by $9,000 per year as a result of the machine. If the firm pays tax at a rate of 33 percent, what is the incremental operating cash flow after tax for year one?

Reference no: EM132645390

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