What is the net incremental operating cash flow

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Problem - Calvin Broadus owns a golf course and bought a lawn mower for $20,000. With this new machine, the company was able to increase its business, raising its annual revenue from $250,000 to $350,000 each year. Operating costs went up as well, however, from $70,000 to $100,000 annually. The mower falls in the MACRS five-year class for depreciation expense, and the company's combined federal and state income tax rate is 35 percent. What is the net incremental operating cash flow in year 1 for the new lawn mower investment?

Reference no: EM132722571

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