What is the ocf for project-quad enterprises

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Quad Enterprises is considering a new 5-year expansion project that requires an initial fixed asset investment of $2.7 million. The fixed asset will be depreciated straight-line to zero over its 5-year tax life, after which time it will be worthless. The project is estimated to generate $2,400,000 in annual sales, with costs of $960,000. If the tax rate is 22 percent, what is the OCF for this project?

Multiple Choice

-$1,440,000
-$1,242,000
-$1,179,900
-$702,000
-$1,304,100

Reference no: EM132576523

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